USD/CHF holds below 0.8550 on heightened risk aversion, SNB to adopt a proactive approach

USD/CHF remains below 0.8550 as risk aversion increases the safe-haven CHF demand.
Shipping firms to return to the Red Sea despite Iran’s threat to close the Gibraltar Strait.
Former Dallas Fed President Robert Kaplan expects the Fed not to become overly restrictive.

Akhtar Faruqui FXStreet

USD/CHF pair is relatively quiet, hovering around 0.8540 during the early European hours on Wednesday. Heightened risk aversion seems to lead to the increased demand for safe-haven currencies like the Swiss Franc (CHF).

There are concerns about Iran potentially closing the Gibraltar Strait, many doubt the feasibility of such an action. However, major shipping firms have started to return to the Red Sea, indicating a tentative normalization with the deployment of a multinational task force in the region.

The Swiss National Bank (SNB) is poised to adopt a proactive approach, as revealed in its recent Quarterly Bulletin. The SNB has communicated its readiness to intervene actively in the foreign exchange market when deemed necessary. This signals a hawkish stance, indicating the bank's commitment to managing currency dynamics and supporting the Swiss Franc (CHF).

The US Dollar Index (DXY) moves above 101.50 amid 2-year and 10-year yields on US bond coupons are trading lower, standing at 4.29% and 3.87%, respectively, by the press time. This decline in yields contributes to the overall subdued performance of the US Dollar (USD) in the market.

Former Dallas Federal Reserve President Robert Kaplan's sentiments align with the notion that the central bank is treading cautiously. Kaplan emphasizes the Federal Reserve's historical mistake of maintaining prolonged excessive accommodation even as the economy improved. According to Kaplan, the central bank is now exercising caution to avoid a similar error on the flip side, being mindful not to become overly restrictive.

The upcoming Thursday holds the promise of valuable insights into the economic landscape as the United States (US) is scheduled to release Initial Jobless Claims and Pending Home Sales data. These indicators play a crucial role in understanding the health of the labor market and the real estate sector, providing investors with essential information for assessing the overall economic condition.

USD/CHF: technical levels to watch

Overview
Today last price	0.8546
Today Daily Change	0.0012
Today Daily Change %	0.14
Today daily open	0.8534

Trends
Daily SMA20	0.8687
Daily SMA50	0.884
Daily SMA100	0.8895
Daily SMA200	0.8914

Levels
Previous Daily High	0.858
Previous Daily Low	0.8532
Previous Weekly High	0.8712
Previous Weekly Low	0.8514
Previous Monthly High	0.9113
Previous Monthly Low	0.8685
Daily Fibonacci 38.2%	0.855
Daily Fibonacci 61.8%	0.8562
Daily Pivot Point S1	0.8517
Daily Pivot Point S2	0.85
Daily Pivot Point S3	0.8468
Daily Pivot Point R1	0.8566
Daily Pivot Point R2	0.8597
Daily Pivot Point R3	0.8614

Author

Akhtar Faruqui

FXStreet

Akhtar Faruqui is a Forex Analyst based in New Delhi, India. With a keen eye for market trends and a passion for dissecting complex financial dynamics, he is dedicated to delivering accurate and insightful Forex news and analysis.

AUD/USD consolidates above 0.7000; remains close to monthly top

AUD/USD holds steady above 0.7000 during the Asian session on Friday, trading just below the previous day's monthly low amid diverging forces. A hawkish RBA continues to support the Aussie, while the recent decline in US bond yields keeps the US Dollar depressed near a three-week low. However, oil-driven inflation fears reinforce Fed hike bets, which, along with geopolitical risks, could benefit the safe-haven buck and cap the currency pair.

USD/JPY bounces off one-month low; climbs to 157.00 amid reviving USD demand

USD/JPY rebounds from the 156.00 neighborhood, or a one-month low touched during Friday’s Asian session, with bulls looking to extend momentum beyond 157.00 amid the emergence of some US Dollar buying. Meanwhile, Japan's National CPI rose to a nine-month peak and reaffirmed BoJ rate-hike bets, which could support the Japanese Yen and cap gains for the currency pair.

Gold treads water around $4,000

Gold prices maintain its offered stance in place at the end of the week, hovering around the key $4,000 threshold per troy ounce. The persistent selling bias in the precious metal comes amid decent gains in the US Dollar and an acceptable rebound in US Treasury yields across the curve, all alongside further upside traction in crude oil prices.

Crypto Today: Bitcoin holds the 50-day EMA as Ethereum and XRP face structural resistance

Bitcoin gradually ticks up on Friday, trading above $81,000. The Crypto King has recently defended structural support near $80,000, reinforcing the prevailing bullish outlook. Ethereum similarly edges higher above $2,400, while Ripple trades above $1.32 after testing support around $1.30.

The French bond panic is overdone. Here's what the market is misreading

France's 10-year government bond yield has climbed above 5%, reigniting fears of a sovereign debt crisis in the Eurozone. With public debt exceeding €3.5 trillion, persistent budget deficits and a fragmented political landscape, investors are increasingly questioning the French government's ability to stabilize its finances.

What November 3 means for the Fed's rate path and the US Dollar

The USD faces a decisive period ahead of the November 3 midterm elections. While markets anticipate another interest rate increase from the Fed in December, the battle for control of Congress could reshape fiscal policy expectations and, indirectly, the path of US monetary policy in 2027.