USD/CHF drops to weekly lows below 0.9500

USD/CHF fell below 0.9500 and bottomed at 0.9492, hitting the lowest level August 28. A combination of a weaker US Dollar across the board affected by a decline in US bond yields and a stronger Swiss franc after the ECB meeting, sent the pair lower. 

The 10-year yield dropped to 2.02% reaching the lowest level since Novembers after expectations of another rate hike from the Fed dropped. 

The Swiss franc received a boost from the euro that rose in the market after the ECB meeting and Draghi’s press conference. The central bank kept rates and QE unchanged. Draghi pointed toward a decision in October and warned about the impact of euro volatility on uncertainty. 

ECB's Draghi: Decisions on QE in Oct, volatility in FX rate a source of uncertainty

Draghi speech: We don't see negative effects of QE

2017 lows back in the radar

USD/CHF remains under pressure and is again looking at the area around 0.9425/35 where 2017 lows are located. Before that level support could be seen at 0.9480 and 0.9450.

On the upside, immediate resistance is now located at 0.9525 (Sep 6 low), followed by 0.9570 (daily high). In order to remove the short-term bearish bias the pair needs to rise above a downtrend line from last week highs that currently strands around 0.9570/80.