USD/CHF’s extended rebound last week confirms that correction from 0.8394 has completed at 0.8125 already. Initial bias remains on the upside this week. Decisive break of 0.8394 will resume whole rally from 0.7603 and target 0.8590 fibonacci level, which is close to 100% projection of 0.7948 to 0.8394 from 0.8125. On the downside, below 0.8310 minor support will delay the bullish case and turn bias neutral.
In the bigger picture, rise from 0.7603 should at least be reversing the medium term trend. Focus is on 0.8332 support turned resistance (2023 low) for confirmation. Firm break there will target 61.8% retracement of 0.9200 (2025 high) to 0.7603 at 0.8590. For now, this will remain the favored case as long as 0.8125 support holds.
In the long term picture, price action from 0.7065 (2011 low) are seen as a corrective pattern to the multi-decade down trend from 1.8305 (2000 high). It’s uncertain if the fall from 1.0342 is the second leg of the pattern, or resumption of the downtrend. But in either case, outlook will stay bearish as long as 55 M EMA (now at 0.8571) holds.
