There can be no shorts without longs, so it cannot be the case that shorts drive the value of a currency to zero. What [I]could[/I] do it, however, is the absense of willing longs. If nobody wants to hold a certain currency, it could effectively go to zero, and there’s nothing to prevent that happening from a fundamental perspective - though obviously the political and monetary authorities could act to try to prevent it happening.
Technically, that is correct, because no transaction could occur at a price [B]exactly[/B] equal to zero.
But, for the sake of the OP, who might be confused by your answer, transactions involving [B]both longs and shorts[/B] could take the price of anything, including the price of any currency pair, down to [B]almost[/B] zero.
If selling pressure can drive the USD/CHF down 100 pips, then it can drive the USD/CHF down 1,000 pips, or down 7,800 pips — which would make the USD/CHF = 0.0050 (approximately). In other words, the U.S. dollar = ½ Swiss cent — essentially, zero.
And every tick of that crash to (almost) zero [B]would have involved a long, as well as a short.[/B]
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