USD/CHF drops to session lows as DXY plummets to 93

The USD/CHF pair came under a renewed pressure in the early NA session and fell to its fresh daily low at 0.9625. As of writing, the pair was trading a couple of pips above that level, losing 0.22% on the day.

The pair's downfall seems to be the product of an increasing selling pressure on the greenback. After spending the majority of the day near mid-93s, the US Dollar Index dropped to 93.03 in the early NA session. At the moment, the index is at 93.07, down 0.3% on the day. Although no clear catalysts were apparent behind that recent fall, a sharp drop seen in the U.S. Treasury-bond yields could be weighing on the buck. The 10-year T-bond yield is at 2.18% (-0.64%) at the moment.

Moreover, the weakening risk appetite is also helping the traditional safe-haven CHF find some extra demand as well. Major equity indexes in the U.S. started the day lower on Monday, with the Dow Jones Industrial Average and the S&P 500 losing 0.3% and 0.4% respectively.

• US stocks tread water during opening hour of trade

With an empty economic calendar in the remainder of the day, the market sentiment could continue to impact the pair's price action.

Technical outlook

The initial hurdle for the pair aligns at 0.9670 (20-DMA) ahead of  0.9715 (100-DMA) and 0.9825 (May 18 high). On the flip side, supports could be encountered at 0.9585 (Aug. 18 low), 0.9500 (psychological level) and 0.9440 (Jul. 21 low). The RSI indicator on the daily graph is moving lower towards the 30 mark, suggesting that the bearish momentum is building up in the near-term.