Fear Likely to Drive USD CHF Lower

Fear is driving the USD CHF lower as the U.S. Dollar is losing its luster as a safe haven currency. Technically, the charts indicate further weakness as both the daily and weekly charts are in downtrends.

Fear is driving the USD CHF lower as the U.S. Dollar is losing its luster as a safe haven currency. Concerns over the expanding size of the U.S. debt and the U.S. ability to pay back its obligations, is leading traders to seek the safety of the Swiss Franc. Because of the spike in demand for hard assets, the Swiss Franc has also become an attractive alternative to the U.S. Dollar because of its huge inventory of gold.

Technically, the charts indicate further weakness as both the daily and weekly charts are in downtrends. This week this pair closed inside of a major retracement zone at 1.0972 to 1.0660. Based on the developing chart pattern, this market could accelerate sharply lower if the bottom end of the retracement zone is violated.