- USD/CHF faced rejection near the 0.9200 mark and snapped four days of the winning streak.
- Renewed selling around the USD was seen as a key factor exerting pressure on the major.
- The risk-on mood might undermine the safe-haven CHF and help limit any deeper losses.
The USD/CHF pair refreshed daily lows during the early North American session, with bears now eyeing a sustained break below the 0.9100 round-figure mark.
The pair failed to capitalize on its early uptick to 1-1/2-week tops, instead faced rejection near the 0.9200 mark and for now, seems to have stalled its recent bounce from multi-year lows. The pullback marked the first day of a negative move in the previous five and was sponsored by the emergence of some fresh selling around the US dollar.
Despite rising hopes of a US economic recovery and some follow-through pickup in the US Treasury bond yields, the impasse over the next round of the fiscal stimulus exerted some pressure on the greenback. Even Wednesday’s hotter-than-expected US consumer inflation figures failed to impress the USD bulls or lend any support to the USD/CHF pair.
Meanwhile, the global risk sentiment remained well supported by the latest optimism over a potential vaccine for the highly contagious coronavirus diseases. The risk-on flow might undermine demand for the safe-haven Swiss franc and help limit deeper losses for the USD/CHF major, warranting some caution for bearish traders.
Hence, it will be prudent to wait for some strong follow-through selling below the 0.9100 mark before confirming that the recent corrective bounce might have run out of the steam and positioning for the resumption of the prior/well-established bearish trend.