USD/CHF drops to one-week low, further below 0.8900 ahead of FOMC decision

USD/CHF drifts lower for the second straight day and is pressured by a combination of factors.
Fresh fears of the US banking crisis benefit the CHF and weigh on the pair amid a weaker USD.
Investors now look to the US macro data for some impetus ahead of the crucial FOMC decision.

Haresh Menghani FXStreet

The USD/CHF pair extends the overnight downfall from the vicinity of the 0.9000 psychological mark, or a nearly two-week high and remains under heavy selling pressure for the second successive day on Wednesday. The downward trajectory remains uninterrupted through the first half of the European session and drags spot prices to a one-week low, around the 0.8875 region in the last hour.

Concerns that several other regional US lenders were facing solvency issues fuel worries about a full-blown banking crisis and boost demand for traditional safe-haven Swiss Franc (CHF). Apart from this, the ongoing US Dollar (USD) retracement slide from a three-week high touched on Tuesday further contributes to the offered tone surrounding the USD/CHF pair. The anti-risk flow, along with the uncertainty over the Federal Reserve's (Fed) rate hike path and worries about a US debt default, keep the US Treasury bond yields depressed and continue to weigh on the Greenback.

The US central bank is widely expected to deliver a 25 bps lift-off at the end of a two-day policy meeting this Wednesday. The US Job Openings and Labor Turnover Survey (JOLTS) released on Tuesday, meanwhile, indicated that the ultra-tight US job market is loosening, which could put less pressure on inflation and allow the Fed to soften its hawkish stance. That said, the CPI in the US is still trending well above the central bank's target range and support prospects for further policy tightening. Hence, the focus will remain glued to the highly-anticipated FOMC decision.

Apart from this, the accompanying monetary policy statement and Fed Chair Jerome Powell's comments at the post-meeting press conference will be scrutinized for clues about the policy outlook. This, in turn, will influence the near-term USD price dynamics and provide a fresh directional impetus to the USD/CHF pair. Heading into the key central bank event risk, traders on Wednesday will take cues from the US economic docket, highlighting the release of the ADP report on private-sector employment and the ISM Services PMI, for short-term opportunities.

Technical levels to watch

USD/CHF

Overview
Today last price	0.8879
Today Daily Change	-0.0053
Today Daily Change %	-0.59
Today daily open	0.8932

Trends
Daily SMA20	0.8967
Daily SMA50	0.9145
Daily SMA100	0.9196
Daily SMA200	0.9441

Levels
Previous Daily High	0.8995
Previous Daily Low	0.8924
Previous Weekly High	0.8976
Previous Weekly Low	0.8852
Previous Monthly High	0.9198
Previous Monthly Low	0.8852
Daily Fibonacci 38.2%	0.8951
Daily Fibonacci 61.8%	0.8968
Daily Pivot Point S1	0.8905
Daily Pivot Point S2	0.8879
Daily Pivot Point S3	0.8834
Daily Pivot Point R1	0.8977
Daily Pivot Point R2	0.9021
Daily Pivot Point R3	0.9048

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

EUR/USD looks to stabilize near 1.1600 as focus shifts to US data

EUR/USD is looking to stabilize near 1.1600 in the European session on Wednesday as traders breathe a sigh of relief before the top-tier US ADP jobs and ISM Services PMI data. A pause in the US Dollar uptrend helps the pair's recovery, but surging energy prices due to the Iran war will likely remain a drag.

GBP/USD stays weak near 1.3350 as USD preserves gains

GBP/USD stays in the red below 1.3350 in the European session on Wednesday. Escalating conflict in the Middle East keeps the "flight to safety" theme intact, supporting the US Dollar against the Pound Sterling. Traders will take more cues from the US ADP Employment and ISM Services Purchasing Managers Index reports, which are due later on Wednesday.

Gold sticks to intraday gains above $5,150; upside seems limited amid bullish USD

Gold preserves its modest intraday gains through the Asian session on Wednesday and currently trades just above the $5,150 level, up around 1.30% for the day. Investors remain concerned about a prolonged conflict in the Middle East and its impact on the global economy amid an already uncertain environment.

Bitcoin, Ethereum and Ripple struggle for direction as consolidation persists

Bitcoin, Ethereum and Ripple prices trade with a cautious tone at the time of writing on Wednesday as upside momentum continues to fade across the broader crypto market. BTC remains within a parallel channel, ETH struggles below key resistance, while XRP remains fragile within a descending channel. These top three cryptocurrencies by market capitalization continue to struggle to establish a directional bias amid the consolidation phase.

When rates start driving the bus through a war zone

The volatility regime itself is also changing character. EM carry trades thrive in calm markets. They suffocate in environments that resemble Buckaroo Banzai trading conditions, where headlines move faster than models. That is exactly the world investors are now trying to recalibrate to. Euro rate volatility had been remarkably subdued even while equities were wobbling. That stability is now being questioned, and once volatility leaks into rates it rarely stays contained. Indeed, carry trades love calm seas. War turns the ocean into white water.

Solana Price Forecast: SOL consolidation near resistance as ETF inflows offer mild support

Solana price is facing slight rejection as it approaches the upper boundary of the consolidation range at around $88 on Wednesday. Institutional demand is strengthening as spot Exchange Traded Funds recorded two consecutive inflows so far this week.