“¢ The prevalent USD selling exerts some fresh downward pressure.
“¢ A fresh wave of global risk-on trade does little to lend any support.
The USD/CHF pair held on to its weaker tone through the early European session and has now moved within striking distance of over two-week lows, set last week.
The pair met with some fresh supply at the start of a new trading week and was now being weighed down by the prevalent US Dollar selling bias, led by growing market conviction that the Fed might refrain from raising interest rates further.
Meanwhile, a fresh wave of global risk-on trade, triggered by the latest US-China trade optimism and which tends to undermine demand for the Swiss Franc’s safe-haven demand, also did little to lend any support or attract any buying interest.
The US President Donald Trump said on Sunday that he would delay a hike in US tariffs on Chinese imports to 25% – originally scheduled for March 1, and raised hopes over a possible resolution of the long-standing US-China trade disputes.
With the USD price dynamics turning out to be an exclusive driver of the pair’s momentum, investors now look forward to comments by the Fed Governor Richard Clarida for some impetus amid absent relevant market moving economic releases.
Technical levels to watch
A follow-through weakness below the 0.9980 region (last week’s swing low) is likely to accelerate the slide further towards the 0.9945-40 horizontal zone before the pair eventually drops to test the 0.9900 round figure mark. On the flip side, the 1.0020-25 region now seems to have emerged as an immediate hurdle, above which the pair is likely to aim towards surpassing the 1.0050 intermediate hurdle and aim towards conquering the 1.0100 handle.
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