USD/CHF Mid-Day Outlook

Daily Pivots: (S1) 1.0447; (P) 1.0498; (R1) 1.0570; More

Outlook in USD/CHF remains unchanged. Consolidation from 1.0606 is probably still in progress and another pull back cannot be ruled out to 4 hours 55 EMA (now at 1.0414) or below. But downside should be contained by 1.0296 support. On the upside, above 1.0606 will indicate recent rise from 0.9634 has resumed for next upside target of 161.8% projection of 0.9634 to 1.0249 from 0.9887 at 1.0902. However, with bearish divergence condition in 4 hours MACD as background, break of 1.0296 will argue that the whole rise from 0.9634 may be over. Focus will then be shifted back to 0.9995 support.

In the bigger picture, firm break of 1.0352/83 resistance zone (50% retracement of 1.1105 to 0.9634 at 1.0370 and 38.2% retracement of 1.1596 to 0.9634 at 1.0383) indicates that decline from 1.1596 has completed and a medium term bottom is probably in place at 0.9634 . Sustained trading above 55 days EMA (now at 1.0341) supports this case too. Further rebound should then be seen to resistance zone of 1.0890 to 1.1596. With 38.2% retracement of 1.3283 to 0.9634 at 1.1028 inside the range, strong resistance should be seen there, at least initially. On the downside, break of 0.9995 support is needed to confirm rebound from 0.9634 has completed. Otherwise, another rise is still in favor even in case of deep pull back.

Subscribe to our daily and mid-day newsletter to get this report delivered to your mail box