USDCHF Hits Lowest Since 2011: Reversal Risk from Overstretched Positions

Rowan Ashford

Published: January 27, 2026 3:11 AM ET

USDCHF Hits Lowest Since 2011: Reversal Risk from Overstretched Positions

The US Dollar (USD) recently experienced a decline across multiple currency pairs, hitting its lowest point against the Swiss Franc (CHF) since 2011. This drop has raised concerns about the potential for a market reversal due to overstretched positions.

Market Analysis of the USD and CHF

The slide in the USD was influenced by rumors regarding the New York Federal Reserve’s activities in the USD/JPY market. Traders interpreted this as a potential intervention to bolster the Japanese Yen, leading to a sell-off of the greenback. This decline was largely technical rather than driven by economic fundamentals.

As of now, there appears to be little impetus for the USD to recover. The Federal Open Market Committee (FOMC) meeting scheduled for Wednesday is anticipated to maintain current interest rates. Analysts expect no surprises from this gathering, as the central bank is likely to adopt a data-dependent approach in its future rate decisions.

Upcoming Economic Indicators

February is poised to be significant for the USD. The release of crucial economic data, particularly the Non-Farm Payroll (NFP) report, may impact market dynamics. Recent improvements in US Jobless Claims data indicate a potential strengthening of the labor market. Currently, the market is pricing in approximately 48 basis points of easing by the end of the year.

CHF Stability Amidst Changes

On the side of the CHF, the Swiss National Bank (SNB) recently maintained its current policies, expressing optimism regarding future economic conditions due to lower US tariffs. Officials have consistently emphasized that the threshold for implementing negative interest rates remains high, causing the CHF to primarily respond to risk sentiments in the market.

Technical Breakdown of USD/CHF

The technical analysis of the USD/CHF currency pair reveals a bearish trend. The pair has recently breached the significant support level of 0.7871, establishing new cycle lows.

Daily and Hourly Trends

Analysis of the daily chart shows the importance of monitoring a downward trendline that hints at continued bearish momentum. Risk management for traders is crucial, as sellers can find advantageous setups near the trendline to target further declines.

On the 4-hour and 1-hour charts, resistance remains around the 0.78 level. Sellers continue to exert pressure, with buyers eyeing potential breaks above this level for a move towards the 0.80 mark. The red lines on the charts represent the average daily trading range.