USD/CHF Daily Outlook

Daily Pivots: (S1) 1.0850; (P) 1.1030; (R1) 1.1191; More

USD/CHF recovers mildly after drawing support from 4 hours 55 EMA. Nevertheless, with 4 hours MACD staying below signal line, it's believed that rebound from 1.0366 has completed at 1.1277 already. Further downside is still expected for retesting this low first. Break will bring resumption of whole decline from 1.2296. On the upside, though, above 1.1277 will suggest that rise from 1.0366 is still in progress for 61.8% retracement of 1.2296 to 1.0366 at 1.1559 before completion

In the bigger picture, the lack of follow through selling after breaking 1.0410 low dampens the immediate bearish case. Nevertheless, note that firstly, the depth and steepness of the decline from 1.2296, as well as the breaking of 1.0623/51 cluster support (61.8% retracement of 0.9634 to 1.2296 at 1.0651), suggest that whole rise from 0.9634 has completed. Secondly, recent development argues that fall from 1.2296 might be completed with five waves down to 1.0336, which is impulsive in nature. Hence, while some consolidation could still be seen, the decline from 1.2296 is in favor to resume after such consolidation.

However, note that sustained trading above 1.1559 fibo resistance will indicate that fall from 1.2296 should merely be a correction. And in other words, favor will be shifted back to the case that medium term rise from 0.9634 is still in progress.

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