USD/CHF Mid-Day Outlook

Daily Pivots: (S1) 1.0804; (P) 1.0850; (R1) 1.0909; More

USD/CHF's break of 1.0760 suggests that correction from 1.0954 has resumed and might extend lower towards 1.0650 support. But after all, downside is expected to be contained there and bring strong rebound. We's still favoring the case that USD/CHF has bottomed out at 1.0590. Above 1.0897 will indicate that rebound from there is resuming and should target 1.1158/1740 key resistance zone next.

In the bigger picture, fall from 1.1963 is treated the third leg of the consolidation that started at 1.2296, which corrects the whole rally from 0.9634. With daily MACD staying well above signal line, such decline is tentatively treated as completed and hence, stronger rise is in favor to 1.1158/1.1740 resistance zone. Nevertheless, we'd favor that such consolidation is developing into triangle pattern and hence, upside should be limited by 1.1158/1740 initially and bring one more fall before completing the consolidation. However, break of 1.1963 will serve as the first signal that whole rally from 0.9634 is resuming.

On the other hand, note that a break of 1.0590 low will indicate that fall from 1.1963 is still in progress for 1.0366, or even further to 100% projection of 1.2296 to 1.0366 from 1.1963 at 1.0033 before completing the consolidation from 1.2296.

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