- US Dollar tumbles after Powell’s comments, amid lower US yields.
- USD/CHF turns negative for the week, moves away from weekly highs.
The USD/CHF pair dropped below 0.9900 and fell to 0.9885, reaching the lowest level since last Friday. It then bounced to the upside but it was unable to hold on top of 0.9900, and as of writing trades at the lows, down 40 pips for the day.
The move lower was triggered by a sharp decline of the US Dollar following comments from Fed’s Chief Powell. He reiterated the Federal Reserve will act to sustain the ongoing economic growth. He also highlighted inflation could stay in low levels for longer than anticipated. His words reaffirmed Fed rate cut expectations. US yields move lower and equity prices higher with the S&P 500 rising above 3,000 for the first time.
The greenback tumbled across the board after the release of the statement, then recovered ground but it is back at daily lows. In a few hours, the Fed will release the minutes from its latest meeting. No new information is seen after Powell’s testimony.
Levels to watch
To the downside, the immediate support is seen at 0.9875, followed by 0.9855 and 0.9830 (July 3 low). While on the upside, resistance levels might be located at 0.9910 (American session high), 0.9925 and 0.9940 (July 10 high).
More levels
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