USD/CHF Mid-Day Outlook

Daily Pivots: (S1) 1.1011; (P) 1.1091; (R1) 1.1140; More

USD/CHF recovers after drawing support from 4 hours 55 EMA. Though with an intraday top in place at 1.1170, outlook remains neutral. As discussed before, as long as 1.0842 support holds, further rally is still in favor and break of 1.1170 will indicate recent rally has resumed for next target at 1.1596 medium term cluster resistance. However, considering bearish divergence condition in 4 hours MACD and RSI, break of 1.0842 will confirms that a short term top is already formed and will bring deeper decline to 1.0632 resistance turned support or lower.

In the bigger picture, the break of cluster resistance at 1.0999/1028 (100% projection of 0.9634 to 1.0623 from 1.0010 at 1.0999, 38.2% retracement of 1.3283 to 0.9634 at 1.1028) affirms the medium term bullish outlook, indicating that whole rise from 0.9634 is possibly impulsive in nature and should target next cluster resistance at 1.1596 (161.8% projection of 0.9634 to 1.0623 from 1.0010 at 1.1610). Nevertheless, sustained trading below 1.0632 support will raise the odds that whole medium term rebound from 0.9634 has completed and will put focus back to trend line support at 1.0166.

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