USD/CHF drops back closer to 17-month lows

   •  Post-Fed USD rebound loses steam.
   •  Second-tier US data fails to revive USD demand. 
   •  US ISM PMI eyed for some immediate respite. 

The USD/CHF pair surrendered early modest recovery gains and is currently placed at the lower end of its daily trading range. 

The US Dollar struggled to build on overnight rebound, triggered by hawkish signals by the Federal Reserve and did little to assist the pair to register any meaningful recovery, further beyond 0.9340 level touched earlier today. 

With a March Fed rate hike move nearly priced in the market, the latest FOMC policy statement did little to shake off the USD bearish sentiment and was seen as one of the key factors weighing on the major. 

Even today’s better-than-expected second-tier US economic data did little to revive the USD demand and the pair drifted into negative territory for the third consecutive session. 

Currently trading around the 0.9300 handle, the pair remains within striking distance of 17-month lows touched in the previous session and the recent price action clearly indicates that the near-term bearish trajectory might still be far from over. 

Traders now look forward to the US ISM manufacturing PMI for some short-term momentum play but the key focus would be on Friday's non-farm payrolls data, which might assist determine the pair's next leg of directional move. 

Technical levels to watch

A follow-through selling pressure has the potential to continue dragging the pair further towards August 2015 low support near mid-0.9200s en-route 0.9220-15 support area. On the upside, 0.9340 area now seems to act as an immediate hurdle, above which a bout of short-covering could assist the pair towards reclaiming the 0.9400 handle.