- USD/CHF is currently historically weak, but there is plenty of potential for further weakness.
- While USD/CHF is probably technically undervalued, it looks historically strong (even after the recent weakness) relative to fair value.
- This is because CHF has historically traded at a premium to other currencies, surprisingly even against USD.
- Near-term risks, such as U.S. political unrest and the second wave of COVID-19 into the winter months, could lend to a stronger CHF.
- The change in the real implied yield for USD/CHF also lends support to a bearish case on this pair.
For further details see:
USD/CHF Remains Weak, But The Pair Could Fall Further As CHF Holds Firm As A Global Safe Haven