- Swiss franc and safe haven assets tumble after Trump’s comments on China.
- Optimism eases after speculations that Trump’s move was to boost equity markets.
- USD/CHF rebounds sharply from lowest since September but still remains under pressure.
The USD/CHF pair rose from levels near 0.9800 to 0.9863, slightly above yesterday’s highs. The jump from multi-month lows took place after US President Trump mentioned that a deal with China was very close.
Later, speculations about cuts in the US to tariffs on Chinese imports contributed to boost further risk appetite. Equity prices in Wall Street jumped and also did US yields. Safe haven assets including the Japanese yen, the Swiss franc and gold dropped sharply.
The optimism eased following reports suggesting Trump’s tweet could be “another trick to boost stock market”. Expectations still point to some kind of agreement on tariffs before December 15, when higher tariffs will kick in the US.
Levels to watch
Despite the reversal, USD/CHF still faces downside pressure. The rebound so far failed at the critical resistance seen at 0.9860. A consolidation clearly above would clear the way to more gains. As long as it remains below, the bias will favor the downside. From the current level, 0.9830 is the immediate support followed by today’s low at 0.9805/10 and the September low at 0.9795.
Share
