USD/CHF rebounds after hitting YTD low amid risk-off impulse on US recession fears

Private hiring in February rose by 145K, lower than anticipated.
ISM Non-Manufacturing PMI drops to 51.2, below expectations and the previous month’s reading.
USD/CHF Price Analysis: Bullish continuation requires reclaiming 0.9100 resistance; otherwise, further losses lie below 0.9000.

Christian Borjon Valencia FXStreet

USD/CHF hits a new YTD low at 0.9005 but rebounds as a risk-off impulse, seeing a flight to safety, as shown by US equities trading in the red. Growing concerns in the United States (USD) arose after the last tranche of US economic data increased the likelihood of a recession. At the time of writing, the USD/CHF is trading at 0.9070.

Wall Street fluctuates between gains and losses. US Treasury bond yields continued to drop as the bond market rallied, on investors seeking safe-haven assets. The USD/CHF fell to a multi-month low, though it recovered some ground after US data revealed elevated recession fears.

The ISM Non-Manufacturing PMI headed to 51.2, less than the expected 54.4, and fell short of the previous month’s reading of 55.1. Business activity deterioration, and a decline in new orders growth, were the reasons for the dip. Earlier, the ADP Employment Change report showed that private hiring in February rose by 145K, below the anticipated 200K, trailing January’s upwardly revised figure of 261K.

Given the backdrop that labor market indicators suggesting a downturn in unemployment claims could pave the way for a weak US Nonfarm Payrolls report. The consensus estimates that the US economy in March created 240K jobs, lower than February’s 311K.

USD/CHF Technical Analysis

The daily chart shows that the USD/CHF remains downward biased. Wednesday’s fall toward a multi-month low at around 0.9005 and a late recovery is forming a hammer, which, preceded by a downtrend, can exacerbate an upward correction. For a bullish continuation, the USD/CHF needs to reclaim 0.9100. Above that resistance, a previous support trendline turned resistance around 0.9170-0.9180, which would be the next supply zone, ahead of testing the 20-day EMA. Otherwise, the USD/CHF could extend its losses below 0.9000.

What to watch?

Author

Christian Borjon Valencia

FXStreet

Markets analyst, news editor, and trading instructor with over 14 years of experience across FX, commodities, US equity indices, and global macro markets.

AUD/USD holds rebound near 0.6900 on US-China trade optimism

AUD/USD holds the rebound near 0.6900 in the Asian session on Monday. Mixed China's inflation data for October fails to provide any inspiration to the Chinese proxy, the Australian Dollar, but China's extension of the suspension of 24% tariffs on US goods and reduced US-Iran tensions help the Aussie pair cling to recovery gains.

USD/JPY retreat in sync with USD, appraches 158.00

USD/JPY is back in the red at the start of the week on Monday, eyeing the broad US Dollar retreat amid easing US-Iran tensions. Traders also resorting to profit-taking following the blockbuster US Nonfarm Payrolls data-led rally. US CPI report is next in focus.

Gold climbs to two-day highs past $4,100

Gold resumes its recovery and surpasses the $4,100 mark per troy ounce at the beginning of the week. The yellow metal’s solid performance comes amid fresh downside pressure on the US Dollar, shrinking US Treasury yields and a marked retracement in crude oil prices.

Crypto Today: Bitcoin, Ethereum, and Ripple extend downtrend as selling pressure mounts

Major cryptocurrencies, including Bitcoin, Ethereum, and Ripple, maintain a broadly corrective tone, extending losses from the previous week. Risk-off sentiment builds in the crypto market following last week’s correction linked to Democrats sweeping the US midterms.

Two Huangs don’t make a right: Nvidia CEO caught in scandal – NVDA slides

Nvidia CEO Jensen Huang sent employees an apology for being unfaithful to his wife, following reports that he may have been targeted in a foreign intelligence operation. Why is Nvidia trading roughly 5–6% below Friday’s close in the overnight market? And – more importantly – does this actually matter to the AI trade?

Gold reclaimed $4,100. Tuesday’s CPI test decides if it holds

Gold (XAU/USD) starts the week on a positive note, reclaiming the $4,100 psychological level as the US Dollar (USD) retreats from its recent highs. The precious metal recovers from Friday's losses, although investors remain cautious ahead of Tuesday's US Consumer Price Index (CPI) report, which could determine the next direction for Bullion.