• A combination of factors dragged USD/CHF lower for the third successive day on Thursday.
  • The risk-off mood benefitted the safe-haven CHF and exerted pressure amid a weaker USD.
  • Disappointing US macro data did little to impress the USD bulls or lend support to the pair.

The USD/CHF pair extended this week's retracement slide from the 1.0065 area, or a two-year peak and witnessed aggressive selling for the third successive day on Thursday. The bearish pressure remained unabated through the early North American session and dragged spot prices to a two-week low, around the 0.9720-0.9715 region in the last hour.

Investors remain concerned that a more aggressive move by major central banks to constrain inflation could hit global economic growth. Adding to this, extended COVID-19 lockdowns in China and the Russia-Ukraine war have been fueling recession fears. This, in turn, took its toll on the risk sentiment and forced investors to take refuge in traditional safe-haven assets, which benefitted the Swiss franc and exerted downward pressure on the USD/CHF pair.

The anti-risk flow triggered modest pullback in the US Treasury bond yields. Moreover, the markets now seem to have fully priced in at least a 50 bps rate hike move over the next two FOMC meetings. This, in turn, prompted fresh selling around the US dollar, which further contributed to the heavily offered tone surrounding the USD/CHF pair. The USD maintained its offered tone and failed to gain any respite from disappointing US macro releases.

In fact, the Federal Reserve Bank of Philadelphia reported that the headline Manufacturing Activity Index fell slid to 2.6 in May from 17.6 last month. This was well below consensus estimates pointing to a reading of 16.0. Adding to this, the Initial Weekly Jobless Claims rose to 218K during the week ending on May 14, above the 200K expected and the 197K previous. Thursday's US economic docket also features the release of Existing Home Sales.

Nevertheless, the data might do little to impress the USD bulls or lend any support to the USD/CHF pair. With the latest leg down, spot prices have now reversed a major part of the monthly gains recorded over the past two weeks or so. Some follow-through selling below the 0.9700 mark will set the stage for a deeper corrective pullback. Bearish traders might then aim to test the next major support, just ahead of the 0.9500 psychological mark.

Technical levels to watch

USD/CHF

Overview
Today last price 0.9966
Today Daily Change 0.0031
Today Daily Change % 0.31
Today daily open 0.9935
 
Trends
Daily SMA20 0.9791
Daily SMA50 0.9519
Daily SMA100 0.9362
Daily SMA200 0.9288
 
Levels
Previous Daily High 1.0026
Previous Daily Low 0.9918
Previous Weekly High 1.0049
Previous Weekly Low 0.9872
Previous Monthly High 0.9759
Previous Monthly Low 0.9221
Daily Fibonacci 38.2% 0.9959
Daily Fibonacci 61.8% 0.9985
Daily Pivot Point S1 0.9893
Daily Pivot Point S2 0.9852
Daily Pivot Point S3 0.9786
Daily Pivot Point R1 1.0001
Daily Pivot Point R2 1.0067
Daily Pivot Point R3 1.0109

 

 

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Feed news Join Telegram

Recommended content


Recommended content

Editors’ Picks

EUR/USD steadies near 1.0550, looks to post modest weekly gains

EUR/USD steadies near 1.0550, looks to post modest weekly gains

EUR/USD has lost its bullish momentum after having climbed above 1.0570 with the initial reaction to the US data in the American session and retreated toward the mid-1.0500s. On a weekly basis, the pair remains on track to close in positive territory. 

EUR/USD News

GBP/USD struggles to hold above 1.2300

GBP/USD struggles to hold above 1.2300

GBP/USD has edged lower following a jump above 1.2300 in the early American session on Friday. The market mood remains upbeat ahead of the weekend with Wall Street's main indexes posting strong daily gains on upbeat US data. 

GBP/USD News

Gold stays below $1,830 as US yields edge higher

Gold stays below $1,830 as US yields edge higher

Gold continues to fluctuate below $1,830 on Friday and looks to close the second straight week in negative territory. Fueled by the risk-positive market environment, the benchmark 10-year US Treasury bond yield is up more than 1% on the day, limiting XAU/USD's upside.

Gold News

Why Cardano could surprise over the weekend

Why Cardano could surprise over the weekend

ADA  set to close out the week with a gain on the workday trading week and over the weekend? Central banks signaled that the rate hike cycle is ending, meaning less stress and tight conditions for trading, opening up room for some upside potential with Cardano set to pop above $0.55 and test a significant cap.

Read more

FXStreet Premium users exceed expectations

FXStreet Premium users exceed expectations

Tap into our 20 years Forex trading experience and get ahead of the markets. Maximize our actionable content, be part of our community, and chat with our experts. Join FXStreet Premium today!

BECOME PREMIUM

Forex MAJORS

Cryptocurrencies

Signatures