USD/CHF Mid-Day Outlook

Daily Pivots: (S1) 1.0819; (P) 1.0971; (R1) 1.1240; More

USD/CHF's rally continues today and extends further to as high as 1.1277 so far, taking out mentioned 1.1135 resistance. At this point, intraday bias remains on the upside as long as 1.1000 minor support holds and further rally should be seen towards 61.8% retracement of 1.2296 to 1.0366 at 1.1559. On the downside, below 1.1000 will suggest that such rebound has completed and flip intraday bias back to the downside for retesting 1.0366 low.

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 now be seen, with risk of rebounding to 1.1135 resistance or above, the decline from 1.2296 is still slightly 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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