USD/CHF remains depressed near daily lows, just below 0.9300 mark

A combination of factors dragged USD/CHF lower for the third straight day on Monday.
The risk-off impulse benefitted the safe-haven CHF and exerted downward pressure.
Hawkish Fed expectations should help limit the USD losses and lend support to the pair.

Haresh Menghani FXStreet

The USD/CAD pair edged lower through the early part of the European session and was last seen hovering near the lower boundary of its daily trading range, around the 0.9285 region.

A combination of factors failed to assist the USD/CHF pair to capitalize on its Friday's modest bounce of around 25 pips, instead prompted fresh selling on the first day of a new trading week. The risk-off impulse in the markets underpinned demand for the safe-haven Swiss franc. This, along with a modest US dollar weakness, dragged the pair lower for the third successive day.

Worries that China Evergrande Group's debt crisis could spread to the entire property sector in the world's second-largest economy tempered investors' appetite for perceived riskier assets. This was evident from a generally weaker tone around the equity markets, extended some support to traditional safe-haven currencies and acted as a headwind for the USD/CHF pair.

On the other hand, the USD extended last week's retracement slide from the highest level since September 2020 and remained depressed through the first half of the trading action on Monday. This was seen as another factor that exerted some pressure on the USD/CHF pair. That said, prospects for an early policy tightening by the Fed should help limit the USD losses.

Investors seem convinced that the Fed would begin rolling back its massive pandemic-era stimulus as soon as November. The market also seems to have started pricing in the possibility of a Fed interest rate hike in 2022. This, along with a fresh leg up in the US Treasury bond yields, should assist the USD to attract some dip-buying and lend support to the USD/CHF pair.

There isn't any major market-moving economic data due for release from the US on Monday. Hence, the US bond yields will play a key role in influencing the USD price dynamics. Traders might further take cues from the broader market risk sentiment to grab some short-term opportunities around the USD/CHF pair.

Technical levels to watch

USD/CHF

Overview
Today last price	0.929
Today Daily Change	-0.0020
Today Daily Change %	-0.21
Today daily open	0.931

Trends
Daily SMA20	0.9246
Daily SMA50	0.9182
Daily SMA100	0.9141
Daily SMA200	0.9113

Levels
Previous Daily High	0.9338
Previous Daily Low	0.9282
Previous Weekly High	0.9368
Previous Weekly Low	0.9244
Previous Monthly High	0.9368
Previous Monthly Low	0.9116
Daily Fibonacci 38.2%	0.9303
Daily Fibonacci 61.8%	0.9316
Daily Pivot Point S1	0.9282
Daily Pivot Point S2	0.9254
Daily Pivot Point S3	0.9226
Daily Pivot Point R1	0.9338
Daily Pivot Point R2	0.9366
Daily Pivot Point R3	0.9394

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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