• USD/CHF bounces up from eight-week lows at 0.8127 but remains more than 0.5% down in the da¡ily chart.
• US President Donald Trump’s defeat in the midterm elections has sent the US Dollar tumbling across the board.
• Tuesday’s ejection at 0.8220 has confirmed a Double Top at the 0.8380 area.

The US Dollar (USD) has reversed Tuesday’s gains against the Swiss Franc (CHF) on Wednesday and dives more than 0.5% on the daily chart, as investors ponder the consequences of a sound Democratic victory in the US midterm elections. The USD/CHF pair is trading around 0.8160 in the early European session, after bouncing from nearly eight-week lows at 0.8127, but maintains its broader bearish trend fully in play.

Investors sold the US Dollar across the board on Wednesday as the first results of the US elections made clear that voters have shown an unquestionable rebuke to President Donald Trump’s policies. The Democratic Party has taken control of Congress and the Senate, flipping hardcore Republican strongholds like Kansas, North Carolina, and Texas to their side.

According to ING’s Chris Turner, the recent US Dollar recovery “probably owes to the fact that the Democrats do not take office until January,” as well as President Trump “accepting these results,” which has limited follow-through selling after the midterms.

That said, Turner cautions that “ A Democrat Congress would be a mild dollar negative – both in terms of what it would mean for the AI story and the prospect of a prolonged US government shutdown potentially from next summer.”

Technical Analysis: USD/CHF confirms a Double Top at the 0.8380 area

USD/CHF has bounced up to 0.8159 at the early European session but remains trading within a bearish channel, and the rejection at 0.8220 on Tuesday confirms a Double Top (DT) formation at 0.8380, providing further hope for sellers. Momentum indicators in 4-hour charts endorse this view, as the Relative Strength Index (14) remains below 40, while above oversold levels, with the Moving Average Convergence Divergence (MACD) fractionally negative, hinting that the immediate upside momentum is fragile.

Downside attempts have been contained around 0.8130 so far, but the measured target of the mentioned DT lies at the early September lows between 0.8050 and 0.8070. Bulls, on the contrary, should break the mentioned DT’s neckline at 0.8220 to shift the focus towards early November highs, around 0.8250, and the October 28 high, at 0.8313.