USD/CHF rebounds sharply from multi-year lows, closes in on 0.9100
- USD/CHF slumped to its lowest level in more than five years at 0.9010.
- Sharp upsurge witnessed in EUR/CHF confirms broad CHF weakness.
- Investors wait for FOMC to publish July Meeting Minutes.
The USD/CHF dropped to its lowest level since early 2015 at 0.9010 on Tuesday and spent the first half of the day moving sideways near that level on Wednesday. However, the pair staged a decisive recovery ahead of the American session and rose all the way up to 0.9083. As of writing, USD/CHF was up 0.45% on a daily basis at 0.9078.
CHF selloff picks up steam
The recent upsurge witnessed in USD/CHF seems to be driven by a strong selling pressure surrounding the CHF. Reflecting the broad-based CHF weakness, the EUR/CHF pair gained around 50 pips in the last hour and currently trades at fresh two week highs above 1.0800.
Although it's unclear, the Swiss National Bank (SNB) might be stepping in to curb the CHF's gains. In a recently published analysis, Morgan Stanley analysts said the Swiss franc is still considered as a safe haven but noted that its dynamics are shifting. According to analysts, CHF's "appreciation potential is limited by Swiss National Bank FX intervention,” as reported by CNBC.
On the other hand, the US Dollar Index stays relatively calm near 92.30, allowing the CHF's valuation to continue to drive USD/CHF's movements. Later in the day, the FOMC will release the July Meeting Minutes.
Technical levels to watch for