USD/CHF struggles near 0.9270 region, lowest since March 10
|- USD/CHF witnessed some selling for the third consecutive session on Thursday.
- Sustained USD selling bias was seen as a key factor that kept exerting pressure.
- Bulls seemed rather unimpressed by the upbeat mood across the equity markets.
The USD/CHF pair continued losing ground through the mid-European session on Thursday and dropped to fresh multi-month lows, around the 0.9265 region in the last hour.
The pair remained depressed for the third consecutive session and prolonged its recent bearish trend further below the 0.9300 round-figure mark amid the prevalent selling bias around the US dollar. Worries that the second wave of coronavirus outbreak in the US could delay the economic recovery continued exerting some pressure on the greenback.
This coupled with the impasse over the next round of US fiscal stimulus measures further undermined sentiment surrounding the greenback. The bill is expected to be introduced in the Senate as early as this Thursday. Democrats have drawn up plans for as much as $3.5 trillion in fresh spending, while Republicans have dismissed that number as unrealistic.
Adding to this, concerns over worsening US-China relations benefitted the safe-haven Swiss franc and contributed to the USD/CHF pair's slide to the lowest level since March 10. Meanwhile, the optimism over a COVID-19 vaccine remained supportive of the upbeat market mood and might turn out to be the only factor that might help limit further weakness.
Even from a technical perspective, technical indicators on short-term charts are flashing oversold conditions. This, in turn, might hold investors from placing fresh bearish bets and assist the USD/CHF pair to stage a modest bounce. However, any attempted recovery move might still be seen as a selling opportunity and is more likely to remain limited.
Market participants now look forward to the release of US Initial Weekly Jobless Claims for some impetus. This, along with developments surrounding the US fiscal stimulus plans will influence the USD price dynamics and assist traders to grab some short-term trading opportunities.
Technical levels to watch
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