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  • The USD remained depressed amid increasing odds of a further Fed rate cut move.
  • The prevalent risk-on mood/recovering US bond yields might help limit the downside.
  • Investors look forward to speeches by influential FOMC member for a fresh impetus.

The USD/CHF pair failed to capitalize on its attempted intraday bounce and is currently placed at the lower end of its daily trading range, or over three-week lows near the 0.9860 region.
Following this week’s sharp pullback from the vicinity of the key parity mark, the pair lost some additional ground for the third consecutive session on Friday and fell to an intraday low level of 0.9865 amid persistent US Dollar selling bias. Firming expectations that the Fed will cut interest rates again in October kept the USD bulls and continue exerting some downward pressure on the major.

Fading safe-haven demand does little to lend support

The pair added to its losses recorded over the past two trading session but is likely to show some resilience at lower levels on the back of subdued demand for traditional safe-haven assets. This was evident from a goodish pickup in the US Treasury bond yields, which helped limit any deeper USD downfall and might further collaborate towards limiting the downside.
However, given the previous session’s decisive break below a two-month-old ascending trend-channel, any meaningful recovery attempt might still be seen as an opportunity to initiate some fresh bearish positions. In absence of any major market-moving economic releases, the USD price dynamics/broader market risk sentiment might continue to act as key determinants of the pair’s momentum.
Later during the US session, speeches by influential FOMC members – Dallas Fed President Robert Kaplan, Kansas City Fed President Esther George and Fed Governor Richard Clarida – will now be looked upon to grab some short-term trading opportunities.

Technical levels to watch