USD/CHF drops below 0.9500 to lowest in almost two years

• Swiss franc rises amid risk aversion, DXY hits monthly lows amid lower yields. 
• Equity prices finished lower in Europe; Dow Jones drops more than 2%. 

The USD/CHF broke below 0.9530 and accelerated to the downside, easily breaking 0.9500. As of writing it trades at 0.9485, the lowest level since March 2018. 

The US dollar is falling for the fifth time out of the last six trading days versus the Swiss franc. On Wednesday it rose modestly, giving some signals about a potential consolidation but those did not last and on Thursday resumed the downside. 

The US dollar continues under pressure against majors as the rally in US bonds continues. The US 10-year yield dropped to a new all-time low at 0.925%. Market participants see more rate cuts from the Federal Reserve. Despite the monetary stimulus, equity markets are falling on Thursday. In Europe, indexes dropped around 1.7% on average while in Wall Street the Dow Jones tumbles 2.55%. The risk-off mood is back again as the impact of the coronavirus spreads across the globe. 

Levels to watch 

The bias and the momentum point to further losses in USD/CHF despite oversold readings in main technical indicators and time-frames. On the downside, the next strong support is seen around 0.9455. Now the 0.9500 area is the immediate resistance followed by 0.9530.