USD/CHF pair meets with some supply during the Asian session on Thursday and for now, seems to have snapped a three-day winning streak to the weekly top, around the 0.9055 area touched the previous day. Spot prices currently trade near the lower end of the daily range, around the 0.9025 region, and seem vulnerable to sliding further.

US President Donald Trump said on Wednesday that he will announce tariffs on a number of products next month or even sooner. This fuels concerns about a global trade war and tempers investors' appetite for riskier assets, which is evident from a generally weaker tone around the equity markets and benefits traditional safe-haven currencies, including the Swiss Franc (CHF). Apart from this, the emergence of some US Dollar (USD) selling exerts downward pressure on the USD/CHF pair.
The global flight to safety triggers a fresh leg down in the US Treasury bond yields and to a larger extent, overshadows hawkish FOMC minutes released on Wednesday. This, in turn, fails to assist the USD Index (DXY), which tracks the Greenback against a basket of currencies, to build on its bounce from the vicinity of a two-month low tested earlier this week. That said, expectations for an extended pause on rates by the Federal Reserve (Fed) could support the buck and the USD/CHF pair.

Hence, it will be prudent to wait for strong follow-through selling before confirming that the currency pair's recovery from the 0.8970-0.8965 horizontal support, or the year-to-date low has run out of steam. Traders now look forward to Thursday's US economic docket – featuring the release of the usual Weekly Initial Jobless Claims and the Philly Fed Manufacturing Index. Apart from this, speeches by influential FOMC members might influence the USD price dynamics and the USD/CHF pair.

Source: Fxstreet