The USD/CHF pair traded with a negative bias for the third consecutive day, despite the lack of further selling amid mixed fundamental signals. Spot prices managed to hold above their weekly low throughout the Asian session on Thursday and are currently trading just above the mid-0.8000s, down 0.10% for the day.

The US dollar (USD) weakened to near a one-and-a-half-week low amid growing acceptance that the Federal Reserve (Fed) will resume its interest rate cutting cycle in September. This bet was reaffirmed by Friday's weaker-than-expected US Nonfarm Payrolls (NFP) report and Tuesday's disappointing ISM Services PMI release. This kept US Treasury bond yields high and continued to weigh on the dollar, which, in turn, is expected to exert pressure on the USD/CHF pair.

However, a combination of factors discouraged traders from placing aggressive bullish bets on the Swiss Franc (CHF) and helped limit the pair's decline. Switzerland faces crippling 39% tariffs, crippling its exports to the US. Furthermore, sources familiar with the matter said that US officials rejected Swiss President Karin Keller-Sutter's demand for a 10% tariff. This, coupled with positive risk sentiment, weakened the safe-haven CHF and supported the USD/CHF pair.

Therefore, it would be prudent to wait for a further decline below the weekly trough, around the 0.8025 region, before positioning for further depreciation. Traders now await the release of US Weekly Initial Jobless Claims data for some impetus later in the North American session. Furthermore, speeches by influential FOMC members will boost the USD, which, combined with broader risk sentiment, could generate trading opportunities around the USD/CHF pair. (alg)

Source: FXstreet