USD/CHF extends slide to 0.9930 on the back of a weak US dollar

The decline of the US dollar across the board pushed USD/CHF lower.
The pair dropped to a key level: 20-day MA and an uptrend line.

Matías Salord FXStreet

The USD/CHF pair is falling on Friday for the third-day in-a-row and as of writing was trading at 0.9950, at the 20-day moving average. A weaker US dollar sent the pair lower, extending the weekly loss and moving further away from the parity level.

Another round of Trump’s comments regarding interest rate and trade weakened the US dollar sharply. The US President warned that higher rates represent a disadvantage for the US economy. “The U.S. should be allowed to recapture what was lost due to illegal currency manipulation and BAD Trade Deals. Debt coming due & we are raising rates - Really?", he wrote. After those comments, USD/CHF bottomed at 0.9936.

During the last hours, the pair has been consolidating daily losses, moving in a range between 0.9950 and 0.9935, down 70 pips for the week.

Levels to watch

The pair was rejected from above the 1.000 area and corrected lower. The move to the downside accelerated late on Thursday and continues ton Friday. So far, it stopped at the 0.9930/50 area that is key support. A close significantly below would signal more losses ahead, exposing 0.9900 and 0.9850/55 (Jul low).

If the US dollar manages to hold on top of 0.9950, it could rebound back above 1.0000. A clear break of the 1.0040/50 area is needed to clear the way to more gains.

Author

Matías Salord

FXStreet

Matías started in financial markets in 2008, after graduating in Economics. He was trained in chart analysis and then became an educator. He also studied Journalism. He started writing analyses for specialized websites before joining FXStreet.

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