United Overseas Bank’s (UOB) Quek Ser Leang and Lee Sue Ann report a sharp drop in USD/CHF, with the pair closing down 0.80% and testing key supports. Intraday, they see potential for a brief break below 0.8165, though oversold conditions may limit follow-through. On a 1–3 week horizon, rapidly increasing downward momentum points to a move toward 0.8165 and possibly 0.8140, while resistance at 0.8255 must cap rallies to preserve the bearish bias.

Swiss Franc strength weighs on Dollar

“24-HOUR VIEW: USD dropped to a low of 0.8191 last Friday and then rebounded to close at 0.8250. Yesterday, we indicated that “momentum indicators are turning flat” and we held the view that USD “is likely to range-trade between 0.8225 and 0.8270.” We did not expect the sharp drop that sent USD to a low of 0.8174. USD closed sharply lower, down 0.80% at 0.8184. Today, USD could break below the major support at 0.8165. Given the deeply oversold conditions, USD might not be able to hold below 0.8165. The next support at 0.8140 is unlikely to come into view. Resistance is at 0.8200, followed by 0.8220.”

“1-3 WEEKS VIEW: Last Friday (30 Oct, spot at 0.8240), we highlighted “the slight increase in downward momentum suggests USD could edge lower.” However, we held the view that “any decline should stay within a 0.8190/0.8290 range.” In a sudden and sharp move yesterday, USD broke below 0.8190 and plunged to a low of 0.8174. Downward momentum is increasing rapidly, and USD could decline to 0.8165, potentially testing 0.8140. To keep the momentum going, USD must hold below the ‘strong resistance’ level, now at 0.8255.”