USD/CHF’s rebound from 0.9812 extended to as high as 1.0096 last week. The development affirmed the case of near term reversal. That is, correction from 1.0342 has completed with three waves down to 0.9812. Further rise is expected in near term to 1.0169 resistance to confirm this bullish view.
Initial bias in USD/CHF stays on the upside this week for 1.0169 resistance first. Decisive break there will indicate resumption of rise from 0.9548 and should target 1.0342 key resistance next. On the downside, below 1.0023 minor support will turn bias neutral and bring consolidations before staging another rally.
In the bigger picture, we’re still maintain that firm break of 1.0342 key resistance is needed to confirm underlying bullish momentum in the cross. However, the corrective nature of the fall from 1.0342 to 0.9812 is starting to give the medium term outlook a bullish favor. Hence, in stead of looking for topping signal around 1.0342, we’d now pay closer attention to upside acceleration as USD/CHF approaches this level again.
The long term outlook in USD/CHF stays a bit mixed for the moment. But in case of another medium term fall, we’d expect strong support from 0.9443/9548 support zone. Meanwhile, firm break of 1.0342 will target 38.2% retracement of 1.8305 to 0.7065 at 1.1359.
