The USD/CHF pair extended the previous day’s late pullback from the 0.9885 region, or a multi-week high and witnessed some follow-through selling on Friday. The steady descent extended through the early European session and dragged spot prices to the 0.9800 round-figure mark.
The US dollar was seen consolidating below a two-decade high touched on Thursday. This was seen as a key factor exerting downward pressure on the USD/CHF pair.
Another factor that kept the USD bulls on the defensive is a further decline in the US Treasury bond. The downside, however, remains cushioned as investors preferred to wait on the sidelines ahead of the key US macro releases.
Hence, it will be prudent to wait for strong follow-through selling before confirming that the recent strong rebound from sub-0.9500 levels has run out of steam.
Nevertheless, the USD/CHF pair remains on track to end in the green for the third straight week. It would need to find acceptance above the 0.9855-0.9860 area before traders start positioning for any further gains.