CFD Trading Rate US Dollar vs Swiss Franc (USDCHF)

• USD/CHF recovers further above 0.8850 as the US Dollar bounces back strongly.
• Traders doubt whether the Fed will cut interest rates in December.
• USD/CHF finds a cushion near the 50% Fibo retracement around 0.8800.

The USD/CHF pair extends its recovery above 0.8850 in the North American trading session on Wednesday. The Swiss Franc pair rises as the US Dollar (USD) bounces back strongly amid doubts about whether the Federal Reserve (Fed) will continue its policy-easing cycle in the December meeting.

According to the CME FedWatch tool, trades see a 59% chance that there will be 25 basis points (bps) interest rate cut next month, which will push interest rates lower to 4.25%-4.50%. The probability of a Fed rate cut has diminished from 82.5% a week ago as investors expect President-elect Donald Trump’s economic agenda will boost inflation in the United States (US) along with its economic growth.

Meanwhile, global brokerage firm Nomura expects the Fed to pause the policy-easing cycle in December. "We currently expect tariffs will drive realized inflation higher by the summer, and risks are skewed towards an earlier and more prolonged pause,” analysts at Nomura said.

The Swiss Franc (CHF) witnessed buying interest on Tuesday as a fresh escalation in the Russia-Ukraine war improved its safe-haven bid. However, it turned out short-lived as Russian Foreign Minister Sergei Lavrov pushed back expectations of a nuclear attack.

USD/CHF bounces back after a mild correction to a 50% Fibonacci retracement around 0.8800. The Fibo tool is plotted from a May high of 0.9225 to a September low of 0.8375. Upward-sloping 20-day Exponential Moving Average (EMA) near 0.8765 suggests that the near-term trend is bullish.

The 14-day Relative Strength Index (RSI) oscillates in the 60.00-80.00 range, suggesting a strong bullish momentum.

The asset could rise to near the July 5 low of 0.8950 and the psychological resistance of 0.9000 after breaking above the November 14 high of 0.8918.

In an alternate scenario, a downside move below 38.2% Fibo retracement at 0.8700 could drag the asset towards the October 23 low of 0.8650, followed by the November low of 0.8616.

USD/CHF daily chart

• USD/CHF rebounds to near 0.8835 in Wednesday’s early European session. 
• Markets have pared bets for a 25 bp) interest-rate cut at the December meeting. 
• Any signs of escalating tensions between Russia and Ukraine could boost the CHF, a safe-haven currency.

The USD/CHF pair recovers some lost ground to around 0.8835, snapping the three-day losing streak during the early European session on Wednesday. The growing expectations for a less aggressive policy easing by the Federal Reserve (Fed) provide some support to the pair. Later on Wednesday, the Fed Lisa Cook and Michelle Bowman are set to speak. 

The hawkish remarks from Fed Chair Jerome Powell lifts the USD broadly. Powell said that he wasn’t 'in a hurry' to lower interest rates, which reduced the possibility of rate cuts in December to less than 60%, down from 82% earlier in the week. Kansas City Fed President Jeffrey Schmid said it remains uncertain how far interest rates can fall, but the recent cuts by the Fed indicate confidence that inflation is heading toward its 2% target.

On the Swiss front, heightened tensions between Russia and Ukraine, and its allies in the West might boost the safe-haven flows, benefiting the Swiss Franc CHF). Russia’s Defense Ministry said on Tuesday that Ukraine fired six ballistic missiles at a facility in Bryansk and that ATACMS missiles had been used in the attack.

• USD/CHF trades stronger to near 0.8835 in Tuesday’s early European session. 
• Fed easing bets pared on Trump policy outlook, and strong US economic data. 
• Geopolitical risks might boost the Swiss Franc and create a headwind for the pair. 

The USD/CHF pair edges higher to around 0.8835 during the early European session on Tuesday, bolstered by the firmer Greenback. Switzerland’s October Trade Balance will be released later on Tuesday. Also, the Federal Reserve’s (Fed) Jeffrey Schmid is set to speak. 

The strong US economic data and potential inflation from proposed tariffs have fuelled speculation that the Fed would slow the path of rate reductions, supporting the US Dollar (USD). Additionally, the cautious remarks from Fed Chair Jerome Powell contribute to the USD’s upside. Powell emphasized that the robust economic growth, solid job market, and inflation that remains above its 2% target mean the US central bank does not need to rush to lower interest rates.

Investors await comments from the Fed officials for further cues about the US interest rate trajectory. Markets have pared bets for a 25 basis points (bps) interest-rate cut at the December meeting to less than 59%, down from 62% a day earlier, according to CME FedWatch.

Nonetheless, heightened concerns about the Russia-Ukraine conflict and the ongoing geopolitical tensions in the Middle East could boost the safe-haven flows, benefiting the Swiss Franc. Joe Biden has allowed Ukraine to strike inside Russia with long-range US missiles for the first time, according to CNN News on Sunday. US sources said that Ukraine plans to conduct its first long-range attacks in the coming days, while Russia vowed to retaliate to what it called a "radical change" in the war. 

The Swiss Franc (CHF) weakening this episode (QTD) comes alongside the decline also seen in other major FX, though the magnitude of CHF depreciation was slightly lesser (- 4.7% vs USD) compared to JPY, EUR, GBP, AUD (down over 5-8% vs USD). USD/CHF was last seen at 0.8871 levels, OCBC FX analysts Frances Cheung and Christopher Wong note.

Bullish momentum on daily chart intact

“Safe-haven characteristic of CHF was likely one of the mitigating factors that saw CHF fell by less. Nevertheless, US election outcome was one of the main reasons that triggered broad USD strength as market contemplates a return of US exceptionalism under Trump presidency/ Red sweep.”

“Bullish momentum on daily chart intact though RSI shows signs of easing from near overbought conditions. Near term retracement not ruled out. Support at 0.8800/20 (200 DMA, 50% fibo retracement of 2024 high to low), 0.8720 (21 DMA). Resistance at 0.89 (61.8% fibo), 0.9020 (76.4% fibo).”

“Data of interests this week include sight deposits (Mon), trade data, Swiss watch exports (Tue).”

• USD/CHF drifts lower to near 0.8875 in Monday’s early European session. 
• The US Retail Sales rose 0.4% in October vs. 0.8% prior, stronger than expected. 
• The safe-haven flows might support the Swiss Franc. 

The USD/CHF pair softens to around 0.8875 on Monday during the early European session, pressured by the weakening of the US Dollar (USD). Investors will keep an eye on the Swiss Industrial Production for the third quarter (Q3) and the Federal Reserve’s (Fed) Austan Goolsbee speech later on Monday. 

The Greenback edges lower as Trump Trades lose momentum. However, the encouraging US economic data and the cautious comments from the Fed officials might cap the downside for the pair. On Friday, Boston Fed President Susan Collins stated that monetary policy remains restrictive and an interest rate cut is still on the table for December, but a final decision would be based on the incoming data. Meanwhile, Chicago Fed President Austan Goolsbee said that markets tend to overreact to interest rate changes and that the Fed should maintain a slow and steady approach to reaching the neutral rate.

Data released by the Commerce Department's Census Bureau on Friday showed that US Retail Sales increased by 0.4% in October, following the 0.8% rise recorded in September (revised from 0.4%), beating the estimation of 0.3%. 

On the other hand, the renewed geopolitical tensions between Russia and Ukraine might boost the safe-haven currency like the Swiss Franc (CHF). Citing two US officials familiar with the decision, CNN News reported on Sunday that US President Joe Biden's administration allowed Ukraine to use US arms to strike inside Russia in a significant reversal of Washington's policy in the Ukraine-Russia conflict. 

 

• USD/CHF is in a strong uptrend which keeps making higher highs. 
• However it has reached overbought levels according to the RSI momentum indicator 
• This means bulls should be aware of the increased risk of pullbacks. 

USD/CHF continues rising in its established uptrend but it has now reached overbought levels (above 70) according to the Relative Strength Index (RSI) momentum indicator. When this occurs it advises long-holders not to add to their positions because of the increased risk of a pullback developing.

USD/CHF Daily Chart 

According to technical analysis theory “the trend is your friend” which means it is better to trade in the direction of the dominant trend. As such, the odds favor more upside for USD/CHF. The RSI could continue to remain overbought or fall back into neutral territory first as the price pulls back. 

The pair has now surpassed the target at 0.8873 (July 30 swing high) and is on its way to the next target at 0.9050 (July 2 swing high). Another possible target is 0.9000 due to its significance as a round-number and psychological level.  

• USD/CHF retreats from a four-month high of 0.8917 recorded on Thursday.
• Fed’s Powell stated that US economic performance has been "remarkably good," allowing to lower rates gradually.
• The Swiss Franc could face challenges due to the increased odds of an SNB’s rate cut in December.

USD/CHF pauses its five-day winning streak, trading around 0.8900 during Friday’s Asian session after retreating from a four-month high of 0.8917 reached on Thursday. This pullback is likely due to a downward correction in the US Dollar (USD) following remarks from Federal Reserve (Fed) Chair Jerome Powell.

Fed’s Powell stated that the recent performance of the US economy has been "remarkably good," allowing the Federal Reserve the flexibility to gradually lower interest rates. Meanwhile, Richmond Fed President Thomas Barkin stated that while the Fed has made strong progress so far, there’s still more work to be done to keep the momentum going.

The US Producer Price Index (PPI) rose by 2.4% year-over-year in October, up from a revised 1.9% increase in September (previously 1.8%) and surpassing market expectations of 2.3%. Meanwhile, the Core PPI, which excludes food and energy, increased by 3.1% YoY, slightly above the forecasted 3.0%.

The downside for the USD/CHF pair may be limited, as the Swiss Franc (CHF) could weaken further with the increased likelihood of an interest rate cut by the Swiss National Bank (SNB) in December. This expectation follows Switzerland's inflation rate falling to 0.6% in October, the lowest in over three years, signaling inflation is under control.

SNB Vice Chairman Antoine Martin stated in an interview published on Monday that the SNB is not committed to additional interest rate cuts in December. This comes despite earlier comments suggesting potential reductions to address inflation.

At its September meeting, the Swiss National Bank (SNB) indicated readiness for further rate cuts, with both Chairman Martin Schlegel and Vice Chairman Antoine Martin suggesting the possibility of additional reductions, including a potential return to negative rates, according to Reuters.

• USD/CHF extends its established bull trend higher. 
• The RSI momentum indicator is flashing overbought suggesting increased risk of a pullback. 

USD/CHF breaks above the 200-day Simple Moving Average (SMA) and extends its short and medium-term uptrend. 

USD/CHF Daily Chart 

Given the technical analysis theory that “the trend is your friend” the odds favor more upside. 

However, the Relative Strength Index (RSI) momentum indicator is overbought which advises long holders not to add to their long positions because of the increased risk of a pullback. If a pullback does evolve it will provide a good opportunity to buy at a lower price and catch the uptrend before it resumes. Any correction is likely to find solid support at the 200-day SMA at around 0.8825-30. 

The pair has surpassed the target at 0.8873 (July 30 swing high) and is on its way to the next target at 0.9050 (July 2 swing high). Another possible target is 0.9000 due to its significance as a round-number and psychological level.  

• USD/CHF continues gaining positive traction amid relentless USD buying.
• The Trump trade optimism and elevated US bond yields underpin the USD.
• Technical buying above the 200-day SMA contributes to the positive move.

The USD/CHF pair builds on the previous day's breakout momentum above a technically significant 200-day Simple Moving Average (SMA) and gains traction for the fifth successive day on Thursday. This also marks the sixth day of a positive move in the previous seven and lifts spot prices to the 0.8875 region, or the highest level since July 24 during the Asian session. 

The US Dollar (USD) prolongs the post-US election rally and jumps to a fresh year-to-date (YTD) peak, and turns out to be a key factor acting as a tailwind for the USD/CHF pair. Investors remain optimistic that US President-elect Donald Trump's policies will spur growth and believe that expected protectionist tariffs could stimulate inflation. This might force the Federal Reserve (Fed) to pause its easing cycle, which continues to underpin the Greenback. 

Meanwhile, the US consumer inflation data released on Wednesday reaffirmed bets that the Fed would deliver a third interest rate cut in December against the backdrop of a softening labor market. That said, slower progress toward bringing inflation down could result in fewer rate cuts next year. Adding to this, hawkish remarks by several Fed officials keep the US Treasury bond yields elevated near a multi-month top and further offer support to the buck. 

Market participants now look forward to the US economic docket – featuring the release of the usual Weekly Initial Jobless Claims data and the Producer Price Index (PPI). The focus, however, will remain glued to Fed Chair Jerome Powell's speech later during the US session, which will be scrutinized for cues about the future rate-cut path. This will play a key role in influencing the USD price dynamics and provide some meaningful impetus to the USD/CHF pair.

• USD/CHF extends its upside to near 0.8830 in Wednesday’s early European session. 
• The US October CPI inflation data will take center stage on Wednesday. 
• The uncertainty surrounding Trump’s policy and geopolitical risks might cap the pair’s upside.

The USD/CHF pair trades in positive territory for the fourth consecutive day around 0.8830 during the early European session on Wednesday. The rally in the US Dollar (USD) due to the Trump trades provides some support to the pair.

The Trump trades have underpinned the Greenback and US Treasury bond yields as markets expect the Federal Reserve (Fed) to slow the pace of future rate reduction. The markets have priced in nearly 62.4% of the 25 basis points (bps) rate cut by the Fed at the December meeting, down from 75% last week, according to the CME FedWatch Tool. 

Market players will keep an eye on the key US Consumer Price Index (CPI) inflation data for October, which is due later on Wednesday. The headline CPI is estimated to rise 2.6% YoY in October, faster than the previous reading of a 2.4% increase. The core CPI is expected to remain at 3.3% YoY in October. Meanwhile, the monthly CPI and the core CPI are expected to show an increase of 0.2% and 0.3%, respectively.

A downside surprise in the US annual CPI inflation might diminish the expectations of a December Fed rate cut and could exert some selling pressure on the USD. On the other hand, the markets could push back against expectations for a rate cut in December on hotter-than-expected CPI readings, lifting the Greenback. 

On the other hand, the safe-haven flows could boost the Swiss Franc (CHF) and might cap the upside for the pair. Traders will monitor the development surrounding increased uncertainty about the impact of likely tariffs in the upcoming Trump administration and the ongoing geopolitical tensions in the Middle East. 

• USD/CHF trades in positive territory for the third consecutive day near 0.8810 in Tuesday’s early Asian session. 
• The US CPI inflation data will be the highlight on Wednesday. 
• The SNB made no commitment to keep cutting interest rates.

The USD/CHF pair attracts some buyers to around 0.8810 during the early European session on Tuesday. The stronger US Dollar (USD) broadly provides some support to the pair. The Federal Reserve’s (Fed) Christopher Waller, Thomas Barkin, Neel Kashkari and Patrick Harker are set to speak later in the day. The US Consumer Price Index (CPI), and Producer Price Index (PPI) will be in the spotlight on Wednesday. 

Trump's proposed policies including tax cuts, trade tariffs and deficit spending could trigger a fresh wave of inflation and could compel the US Fed to slow the pace of rate reductions. This, in turn, might underpin the Greenback against the Swiss Franc (CHF). 

The US Dollar Index (DXY), which tracks the performance of the USD against six peers, climbed to fresh four-month highs near 105.70. Traders will shift the focus to the US October CPI inflation data on Wednesday, which might offer some hints about the Fed’s future rate path. 

On the Swiss front, the Swiss National Bank (SNB) Vice Chairman Antoine Martin said on Monday that the central bank is not locked into more interest rate cuts in December. “It’s not useful for central banks to lock themselves into forward-looking communications, since between now and the next decision, there may be changes in conditions that render current communications invalid,” noted Martin. The markets expect the SNB to cut at least 25 basis points (bps) from the current 1% level at its next meeting on December 12.

• USD/CHF keeps rising on US Dollar strength
• It is close to meeting resistance from the 200-day SMA.

USD/CHF extends its short and medium-term uptrend and rises up to within spitting distance of the 200-day Simple Moving Average (SMA). 

USD/CHF Daily Chart 

It will probably encounter tough resistance at the 200 SMA which could pullback as a result. 

Given the technical analysis theory that “the trend is your friend”, however, it is likely to eventually resume its uptrend. 

A decisive break above the 200 SMA at 0.8818 would probably result in a continuation up to the next target at 0.8873 (July 30 swing high).  

The Relative Strength Index (RSI) momentum indicator is not yet overbought suggesting the pair has more upside potential before it gets overextended. 

• USD/CHF climbs to near 0.8770 in Monday’s early European session. 
• The victory of Donald Trump in the US presidential elections provides some support to the USD. 
• SNB’s Martin said the central bank had made "absolutely no commitment" to its future course of action. 

The USD/CHF pair extends its upside to around 0.8770, the highest since August 1 during the early European trading hours on Monday. The upward movement of the pair is bolstered by the strength of the US Dollar (USD) as traders await the US inflation data and Federal Reserve (Fed) speakers this week. 

Analysts expect that Trump's policies would put upward pressure on US inflation and bond yields while slowing the Fed’s path to ease policy. This, in turn, lifts the Greenback against the Swiss Franc (CHF). "Given this, we still expect that the Fed will cut another 25bp at the December meeting, but thereafter will only cut once per quarter, in contrast to our previous forecast for a 25bp cut every meeting," said JPMorgan economist Michael Feroli.

Traders will take more cues from the US Consumer Price Index (CPI), which is due on Wednesday. The headline CPI is expected to show an increase of 2.6% YoY in October, while the core CPI is estimated to show a rise of 3.3% YoY during the same period. In case of the hotter-than-expected outcome, this could further reduce the possibility of a December rate reduction, supporting the USD. 

The Swiss National Bank (SNB) Vice Chairman Antoine Martin said on Monday that the central bank is not locked into more interest rate cuts in December, adding that everything will depend on conditions when we assess the situation in December. The markets anticipate the SNB to cut at least 25 basis points (bps) from the current 1% level at its next meeting on December 12.

• USD/CHF gains ground to near 0.8730 in Friday’s early European session. 
• The Fed cut interest rates by a quarter point at the November meeting on Thursday. 
• The safe-haven flows could underpin the Swiss Franc. 

The USD/CHF pair drifts higher to around 0.8730 during the early European session on Friday. The renewed Greenback demand provides some support to the pair. Traders brace for the advanced US Michigan Consumer Sentiment data for November and the speech from the Federal Reserve’s (Fed) Michelle Bowman later on Friday.

The US Fed on Thursday decided to cut its borrowing costs by 0.25 basis points (bps),  half the size of its September reduction, bringing down the federal funds rate to a range of 4.5% to 4.75% from its current 4.75% to 5% level. Fed Chair Jerome Powell said during the press conference that the "economy is strong overall and has made significant progress toward our goals over the past two years.”

Fed’s Powell emphasized that the Fed doesn't want to move too quickly on the interest rate nor move too slowly and do unnecessary damage to the labor market. The Fed will continue assessing data to determine the "pace and destination" of interest rates. Meanwhile, the US Dollar (USD) attracts some buyers as investors expect Trump's policies would spur economic growth and inflation and reduce the pace of interest rate cuts.

On the other hand, the uncertainty surrounding global economic growth and the ongoing geopolitical tensions in the Middle East could boost the safe-haven flows, benefiting the Swiss Franc (CHF). President-elect Donald Trump's comeback victory on Tuesday undermines diplomatic attempts to stop Israel's multifront conflicts in the near term and calls into question US long-term support for Israel’s military campaigns against Iran and its proxies.

• USD/CHF might be developing a Bull Flag continuation pattern. 
• This suggests there will be an extension of the uptrend to upside targets higher. 

USD/CHF – which looked as if it might be reversing trend and starting a new short-term downtrend at the start of the week – suddenly turned on a dime and spiked higher on Wednesday. 

The pair rallied to a higher high, giving the established uptrend a shot in the arm. USD/CHF has since peaked and started to go sideways, forming what looks like a potential Bull Flag continuation price pattern.

USD/CHF 4-hour Chart 

If it is indeed a Bull Flag pattern it indicates more upside is on the cards for USD/CHF. 

A break above the flag’s high of 0.8775 would probably result in a continuation higher to a target at 0.8832, the 61.8% Fibonacci extrapolation of the  flagpole or “Pole” higher. The flagpole is the steep rally prior to the consolidation. 

The Relative Strength Index (RSI) momentum indicator is not yet overbought but it is close. This suggests there is still more scope for upside before the uptrend becomes temporarily exhausted. If RSI enters the overbought zone it will be a signal for long-holders not to add to their positions. 

• USD/CHF weakens to around 0.8750 in Thursday’s early European session. 
• Investors brace for the US Fed rate decision on Thursday. 
• The safe-haven demand could lift the Swiss Franc against the Greenback. 

The USD/CHF pair softens to near 0.8750 during the early European trading hours on Thursday. Traders might prefer to wait on the sidelines ahead of the US Federal Reserve (Fed) interest rate decision on Thursday. 

The downside for the US Dollar (USD) might be limited as traders expect a Donald Trump presidency will push up inflation and reduce the pace of interest rate cuts. However, the markets might turn cautious later in the day ahead of the US Fed monetary meeting. The US central bank is widely expected to cut interest rates by 25 basis points (bps). According to the CME FedWatch tool, markets have priced in nearly a 98% possibility of a quarter-point reduction and near 70% odds of a similar-sized move in December. 

On the Swiss front, data released by the State Secretariat for Economic Affairs (SECO) on Tuesday showed that the seasonally adjusted Unemployment Rate in Switzerland arrived at 2.6% in October. The figure remained unchanged compared to September. 

The Swiss National Bank (SNB) Chairman Martin Schlegel said last week that the central bank could further cut interest rates to maintain price stability in the mid-term. Markets currently have priced in 72% odds for a 25 bps and a 28% chance for a 50 bps reduction in the December meeting.

Meanwhile, the uncertainty about the global economic outlook and the ongoing geopolitical risks might boost the safe-haven flows, benefiting the Swiss Franc (CHF). As the Middle East teeters on the verge of war, with Iran threatening to react to an Israeli attack on its territory earlier this month, there are worries that Trump's win could enable Netanyahu to hit Iran's nuclear facilities, something the Biden administration has cautioned against, per CNN. 

• USD/CHF holds onto intraday gains near 0.8750 on US Trump’s victory.
• Market participants are expected to face higher import tariffs in Trump’s administration.
• The Swiss Franc pair rallies after breaking above 38.2% Fibo retracement at 0.8700.

The USD/CHF pair rallies to near 0.8750 in Wednesday’s European session. The Swiss Franc pair surges to a fresh three-month high as the US Dollar (USD) soars with former President Donald Trump gaining an unconquered lead over Democratic rival Kamala Harris in the United States (US) presidential elections.

The US Dollar is one of the major beneficiaries of Trump’s victory as he is expected to implement protectionist policies after taking the Senate in a way to boost domestic investment. Trump vowed to raise import tariffs by 10% and lower corporate taxes if he comes into power.

The US Dollar Index (DXY), which gauges the Greenback’s value against six major currencies, surrenders some of its intraday gains but is still 1.30% higher, around 104.80, at the time of writing.

Going forward, investors will focus on the Federal Reserve’s (Fed) interest rate decision, which will be announced on Thursday. The Fed is expected to cut interest rates by 25 basis points (bps) to 4.50%-4.75%.

Meanwhile, the Swiss Franc (CHF) remains on the back foot against the US Dollar for more than a month as the Swiss National Bank (SNB) is expected to cut interest rates again in the last monetary policy meeting of this year in December.

USD/CHF delivers a sharp rally after breaking above the 38.2% Fibonacci retracement around 0.8700. The tool is plotted from May’s high of 0.9225 to September 6 low of 0.8375. The Swiss Franc pair bounced back sharply after gaining ground near the 50-day Exponential Moving Average (EMA), which trades around 0.8617 and has rallied to near the 200-day, which hovers around 0.8750.

The 14-day Relative Strength Index (RSI) climbs above 60.00, suggesting a fresh bullish momentum in sight.

More upside looks likely towards the round-level resistance of 0.8800 and the July 25 high of 0.8850 after sustaining above the 200-day EMA.

On the flip side, a downside move below the 50-day EMA near 0.8617 will push the asset lower to a 23.6% Fibo retracement level near 0.8570, followed by the psychological support of 0.8500.

USD/CHF daily chart

• USD/CHF jumps to a three-month peak on Wednesday amid broad-based USD strength.
• The Trump trade, smaller Fed rate cut bets and surging US bond yields benefit the buck.
• The risk-on mood undermines the safe-haven CHF and further lends support to the pair.

The USD/CHF pair catches aggressive bids on Wednesday and spikes to its highest level since early August, around the 0.8755 region during the Asian session. Spot prices, however, retreat a few pips in the last hour and currently trade just above the 0.8700 mark, still up 0.90% for the day.

The US Dollar (USD) strengthens across the board and spikes to over a four-month peak in reaction to initial US election exit polls, which indicated an early lead for former President Donald Trump in key swing states. Meanwhile, the Trump optimism triggers a fresh wave of risk-on trade across the global equity markets and undermines the safe-haven Swiss Franc, which, in turn, provides an additional boost to the USD/CHF pair. 

Meanwhile, speculations that a Republican sweep could see the launch of Trump's potentially inflation-generating tariffs, along with deficit-spending concerns and bets for a less aggressive easing by the Federal Reserve (Fed), continue to push the US bond yields higher. In fact, the yield on the benchmark 10-year US government bond surges over 15 points at 4.44%, hitting its highest level since July 2 and favors the USD bulls. 

That said, expectations for a further spike in volatility across the financial markets act as a headwind for the buck and hold back traders from positioning for any further appreciating move for the USD/CHF pair. Nevertheless, the fundamental backdrop suggests that the path of least resistance for spot prices remains to the upside. Hence, any subsequent decline might still be seen as a buying opportunity and remain limited.

• USD/CHF is showing increasing evidence it might be reversing trend. 
• It has formed a bearish Two-Bar reversal pattern and has broken the uptrend’s trendline three times. 

USD/CHF looks like it is reversing the uptrend of the last five weeks. The technical evidence is building for the case the pair is beginning a new short-term downtrend. 

USD/CHF Daily Chart 

USD/CHF has formed a bearish Two-Bar reversal pattern (red-border rectangle on chart above) on Monday and Friday. These patterns occur at the end of an uptrend when a longer-than-average long, green candle is followed by a similar length and shape bearish red candle. The pattern indicates a reversal in sentiment. It usually denotes near-term weakness at the very least, more often than not a reversal of trend.

Further the trendline for the rally during October has been broken and redrawn three times (see 4-hour chart below for more detail) and this is another sign of a possible reversal according to technical analysis theory. 

USD/CHF 4-hour Chart

A break below the 0.8615 November 4 low would provide final confirmation of more downside to come and probable establishment of a downtrending bias. Such a break might reach the next target at around 0.8550 where the 50-day Simple Moving Average is located.