USD/CHF flirts with daily lows, just above 0.9400 mark
- USD/CHF edged lower on Wednesday and extended the overnight pullback from weekly tops.
- Concerns about rising COVID-19 cases benefitted the safe-haven CHF and exerted some pressure.
- A subdued USD price action did little to impress bullish traders or lend any support to the major.
- Bears are likely to wait for a sustained break below the 0.9400 mark before placing fresh bets.
The USD/CHF pair refreshed daily lows in the last hour, with bears still awaiting a sustained break below the 0.9400 round-figure mark.
Following the previous day's intraday positive move and a subsequent pullback from weekly tops, the pair met with some fresh supply on Wednesday and was being pressured by a combination of factors. Concerns that the ever-increasing COVID-19 cases across the world could trigger renewed lockdown measures and delay economic recovery benefitted the Swiss franc's relative safe-haven status.
On the other hand, the US dollar failed to capitalize on the overnight bounce and remained on the defensive through the first of trading action on Wednesday. This, in turn, further contributed to the USD/CHF pair's weaker tone during the early European session, albeit a modest uptick in the US equity futures might extend some support and help limit any deeper losses, at least for the time being.
Even from a technical perspective, the pair has been showing some resilience below the 0.9400 round-figure mark. Hence, it prudent to wait for some strong follow-through selling before placing fresh bearish bets. Weakness below June monthly swing lows support, around the 0.9375 region, now seems to set the stage for an extension of the recent bearish trajectory.
Technical levels to watch
Author
Haresh Menghani
FXStreet
Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.
