USDCHF came under a strong sell-off early on Thursday as risk-off sentiment returned to the markets. Technically, the cautious attitude could persist in the short term as the MACD continues to lose weaken below its red signal line and towards zero and the RSI is moving into bearish territory, both endorsing a neutral to bearish bias.
Further losses could reach the area around the 50% Fibonacci of 0.9921 of the downleg from 1.011 to 0.9715, which is surrounded by the 50- and the 200-day moving averages. A shift below the 200-day MA, could open the door for the 38.2% Fibonacci of 0.9873, while even lower the 23.6% Fibonacci of 0.9812 could also provide support to negative corrections.
Alternatively, an upside reversal would likely retest the 20-day MA currently at 1.00 before entering the 1.003-1.009 region. A decisive close above the 1.011 top could prove pricey for the bulls as more gains could follow, shifting attention up to the next resistance of 1.025. The neutral outlook in the bigger picture would also change to a bullish one in this case.
