USD/CHF finds some support ahead of monthly lows

   •  On offers for third straight session amid weaker USD. 
   •  Reviving safe-haven demand adds to the downward pressure. 

The USD/CHF pair extended overnight bearish break below an important confluence support and dropped back closer to monthly lows.

The US Dollar selling pressure remained unabated on the last trading day of the year and has been one of the key factors exerting downward pressure on the major for the third consecutive session. 

Apart from broad-based USD weakness, reviving safe-haven demand, reinforced by a softer tone around the US Treasury bond yields, provided an additional boost to the Swiss Franc's safe-haven demand and further collaborated to the pair's slide to an intraday low level of 0.9747. 

The downslide could also be attributed to some follow-through technical selling, especially after yesterday's fall below important moving averages (200 & 100-day) confluence support near the 0.9785-80 region.

The downward trajectory, however, seems to have stalled, at least for the time being, with the pair rebounding around 15-20 pips from session lows amid pre-holiday thin liquidity conditions and absent US macroeconomic releases. 

Technical levels to watch

Immediate support remains near 0.9735 level (monthly lows), below which the pair is likely to head towards challenging the 0.9700 handle before extending its near-term bearish slide.

On the upside, any further recovery is likely to confront fresh supply near the 0.9785-80 region, which if cleared might trigger a short-covering bounce towards 0.9825-30 resistance.