ZURICH: The Swiss franc was steady against the dollar on Wednesday after hitting its lowest level since August 21 in early trading, with the greenback's strength bolstered by signs of a firm recovery in the U.S. economy and rising Treasury yields.
"The dollar-franc has eroded the 200-week moving average at 9630, immediate pressure is maintained," said Commerzbank technical analysts in a note.
"Dips lower are likely to find that last weeks breached trendline at .9472 acts as decent support now on any pullbacks and while above here the market will remain immediately bid."
The Swiss franc ticked higher against the euro, with the single currency anchored by speculation that the European Central Bank could use negative deposit rates to induce banks to cut their cash holdings.
Against the single currency, the franc remained close to its lowest level since late January, holding a downtrend that began at the start of May.
"A generally risk-on investment environment and expectations for continuously benign Swiss inflation currently weigh on the Swiss franc," UBS economist Reto Hueberwadel said in a note.
Technical analysts said the franc could see further losses against the single currency.
"The market has eroded the 1.2475/76 Fibonacci retracement (78.6 percent retracement). This was the last defence for the 1.2573 2013 high," said Commerzbank analysts in a note.
In its turn, the euro is held back by the risk the European Central Bank could slash its deposit rate, paid on the surplus funds that banks park with the ECB, to negative, essentially charging depositors for leaving funds at the ECB.
The franc was steady against the dollar compared to the New York close, trading at 0.9669 franc per dollar by 0652 GMT.
The franc rose 0.1 percent to 1.2480 against the euro.
