USD/CHF Weekly Outlook

USD/CHF rebounded strongly after diving to as low as 1.0010 initially. The brief break of 1.0250 resistance, with background of mild bullish convergence condition in 4 hours MACD and RSI, argues that decline from 1.0539 has completed. Initial bias remains on the upside this week as long as 1.0134 minor support holds. Above 1.0250 again will encourage stronger rally to 1.0539 resistance first. On the downside, below 1.0134 minor support will flip intraday bias back to the downside for testing 1.0010 low.

In the bigger picture, with 0.9995 support remains intact, there is no confirmation of completion of medium term rebound from 0.9634 yet. Also, so far, the choppy decline from 1.0623 is still looking corrective and argues that it's merely a correction to such medium term rebound. Outlook is mixed with conflicting technical signals. Though, on the upside, above 1.0352 will be the first indication that fall from 1.0623 has completed and affirms it's corrective nature. In such case, stronger rise should then be seen to test this 1.0623 high first. On the other hand, with daily MACD still in negative zone, break of 0.9995 support will confirm that rebound from 0.9634 has completed and turn short term outlook bearish for 0.9634 low.

In the longer term picture, a pattern of lower highs is clearly seen in USD/CHF since the medium term down trend begins at 1.3283. While 0.9634 could be a medium term bottom, there is no clear indication of long term trend reversal yet. 1.1596 resistance will be a key factor that's required to confirm long term down trend reversal, at least before any clear reversal pattern forms. Also, the fall from 1.3283 is still being treated as part of the whole down trend from 1.8305 (00 high) and should extend to 0.9 psychological support (61.8% projection of 1.8305 to 1.1288 from 1.3283 at 0.8964)

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