USD/CHF extends slide toward 0.99 as US stocks suffer heavy losses

The USD/CHF pair came under a renewed pressure in the second half of the day and fell to a 10-day low of 0.9906. As of writing, the pair was down 0.11% on the day at 0.9913.

In the absence of significant macroeconomic data releases on Monday, the markets' risk perception became the primary driver of pair's price action. Major equity indexes in Europe closed the day in the negative territory and Wall Street opened sharply lower to reflect the dismal market mood. Disappointing Q4 earnings results from Caterpillar amid weak China demand revived concerns over a global economic slowdown and weighed on stock markets. As of writing, the Dow Jones Industrial Average was losing 1.4% on the day and the Nasdaq Composite was down 1.8%.

Today's data from the United States showed that the Chicago Fed's National Activity Index improved slightly in December and the Dallas Fed Manucatruig Index recovered to 1 in January from -5.1 in December. Despite these positive readings, however, the US Dollar Index struggled to stage a recovery and was last seen down 0.12% on the day at 95.70.

On Tuesday, trade balance data from Switzerland will be released, which is unlikely to receive a significant market reaction from the market. Ahead of Wednesday's critical FOMC meeting, market sentiment could continue to impact the pair.

Key technical levels