USD/CHF flirts with session lows, below 0.9100 mark
|- USD/CHF met with some fresh supply on Tuesday amid some renewed USD selling bias.
- The upbeat market mood undermined the safe-haven CHF and might help limit losses.
- Investors might also be reluctant to place aggressive bets ahead of Powell’s speech.
The USD/CHF pair edged lower through the early European session and dropped to fresh daily lows, around the 0.9080 region in the last hour.
The pair failed to capitalize on the previous day's goodish intraday bounce of over 50 pips, instead met with some fresh supply on Tuesday and weakened back below the 0.9100 mark on Tuesday. The emergence of some fresh selling around the US dollar was seen as one of the key factors exerting some pressure on the USD/CHF pair.
However, the upbeat market mood might undermine demand for the safe-haven Swiss franc and help limit any deeper losses. The global risk sentiment remained well supported by hopes of a potential vaccine and treatment for the COVID-19 virus. This coupled with a positive trade-related development further boosted investors' confidence.
The US Trade Representative’s Office said in a statement that both the US and China see progress made on resolving issues in phase one trade deal between the two countries. Apart from this, a strong pickup in the US Treasury bond yields might extend some support to the greenback and help limit the downside for the USD/CHF pair.
Apart from this, investors might also be reluctant to place any aggressive bets ahead of the Fed Chair Jerome Powell's speech at the Jackson Hole Symposium. This makes it prudent to wait for some strong follow-through selling before positioning for an extension of the recent well-established bearish trend.
Moving ahead, market participants now look forward to the US economic docket, highlighting the release of the Conference Board's Consumer Confidence Index. The data might influence the USD price dynamics and produce some short-term trading opportunities later during the early North American session.
Technical levels to watch
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