The stronger than expected rebound from 0.9854 mixed up outlook in USD/CHF. Initial bias remains neutral this week first with focus on 1.0008 support turned resistance. As long as 1.0008 holds, further decline is still expected. Sustained break of 0.9836 fibonacci level should confirm medium term reversal. However, break of 1.0008 will indicate completion of fall from 1.0237 and turn bias to the upside.
In the bigger picture, USD/CHF’s break of long term trend line support is the first indication of medium term reversal. That is, rise from 0.9186 (2018 low) could have completed at 1.0237 already). Sustained break of 38.2% retracement of 0.9186 to 1.0237 at 0.9836 will confirm and target 61.8% retracement at 0.9587. However, strong rebound from 0.9836 will revive medium term bullishness for 1.0237 and above.
In the long term picture, price actions from 0.7065 (2011 low) are not clearly impulsive yet. Thus, we’ll treat it as developing into a corrective pattern, at least, until a firm break of 1.0342 resistance.
