USD/CHF braces for fresh multi-year low below 0.8600 on upbeat Swiss trade numbers, softer US Dollar

• USD/CHF remains on the back foot at the lowest levels since January 2015 marked on Tuesday.
• Swiss trade surplus widens more than expected in June, Exports, Imports
• US Dollar drops on market’s reassessment of Fed bets amid mostly downbeat data.
• Risk catalysts eyed ahead of next week’s all-important FOMC.

USD/CHF bears keep the reins at the lowest levels since January 2015, down for the second consecutive day while reversing the previous day’s corrective bounce. In doing so, the Swiss Franc (CHF) pair justifies the downbeat US dollar and firmer Swiss trade numbers around 0.8560 amid the initial hour of Thursday’s European session.

Swiss Trade Balance rose to 4,823M versus 4,031M expected despite being lower than 5,442M prior. Details suggest that the Exports grew to 24,917M from 23,879M previous readings whereas the Imports also rose to 20,093M compare to 18,438M marked in May.

Apart from the broadly upbeat Swiss foreign trade numbers for June, broad US Dollar weakness also allows the USD/CHF bears to keep the reins. That said, US Dollar Index (DXY) drops 0.25% intraday to retest the 100.00 round figure while snapping a two-day rebound from the lowest level since April 2022. With this, the greenback justifies the previous day’s downbeat US housing data and mixed concerns about the Fed, as well as ignores the optimism at the US banks.

It’s worth noting that the CHF’s haven appeal and the market’s cautious mood amid mixed headlines about China and global central banks keep the USD/CHF bears in the driver’s seat.

Additionally, the hawkish bias of the Swiss National Bank (SNB) contrasts with the market’s doubt about the Federal Reserve’s (Fed) future performances past July to weigh on the USD/CHF prices.

Against this backdrop, the S&P500 Futures print mild losses whereas the US Treasury bond yields trade mixed at the weekly low.

Looking ahead, the risk catalysts may entertain the USD/CHF pair traders ahead of the US Initial Jobless Claims and Existing Home Sales. Above all, the next week’s Federal Open Market Committee (FOMC) monetary policy meeting announcements will be crucial to watch for clear directions.

Technical analysis

Failure to cross even the 5-DMA hurdle of around 0.8590 despite the oversold RSI (14) keeps the USD/CHF sellers hopeful of witnessing further downside toward the year 2015 low of 0.8365.