USD/CHF dives to fresh multi-year lows, eyeing 0.8900 amid notable USD supply

The USD/CHF pair dived to fresh multi-year lows during the early North American session, with bears now eyeing some follow-through weakness below the 0.8900 mark.

The US dollar index prolonged its recent bearish trend and plunged to its lowest level in more than two years on Thursday amid signs of progress towards additional US fiscal stimulus. This, in turn, was seen as one of the key factors that continued exerting pressure on the USD/CHF pair for the third consecutive session on Thursday.

The greenback remained depressed and failed to gain any meaningful traction following the release of Initial Weekly Jobless Claims, which fell to 712K during the week that ended on November 27. The print was well below the 775K anticipated but was largely negated by an upward revision of the previous week's reading to 787K from 778K.

The USD/CHF pair tumbled to levels not seen since January 2015 and the downward trajectory seemed rather unaffected by optimism about the roll-out of COVID-19 vaccine. The UK on Wednesday approved a vaccine jointly developed by Pfizer and BioNTech, though did little to undermine the safe-haven Swiss franc or lend any support to the major.

Thursday's US economic docket also highlights the release of ISM Services PMI. The data, however, is unlikely to provide any respite to the USD bulls, though slightly oversold conditions might help limit any further downside for the USD/CHF pair. That said, some follow-through selling below the 0.8900 mark should pave the way for additional weakness.

Technical levels to watch