Weekly
    •    Last Candlesticks pattern: Shooting star
    •    Time of formation: 7 Mar 2017
    •    Trend bias: Sideways

Daily
    •    Last Candlesticks pattern: Morning star
    •    Time of formation: 9 May 2017
    •    Trend bias: Near term up

USD/CHF – 0.9920

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As the greenback found good support at 0.9735 earlier this month and has staged a strong rebound, adding credence to our view that low has possibly been formed there and consolidation with mild upside bias is seen for another test of resistance area at 0.9978-87, however, above there is needed to signal the fall from 1.0039 has ended at 0.9735, bring test of indicated resistance at 1.0018, break there would provide confirmation and bring retest of this level first.

On the downside, whilst pullback to the Tenkan-Sen (now at 0.9857) can not be ruled out, reckon 0.9830-35 would limit downside and bring another rise later. Below 0.9795-00 would risk retest of said support at 0.9735 but only a drop below this support would shift risk back to downside and signal top has been formed at 1.0039 earlier, bring retracement of recent upmove from 0.9421 to minor support at 0.9670, then 0.9642 (another support) but reckon downside would be limited to 0.9590-00 and support at 0.9565 should remain intact.

Recommendation: Buy at 0.9835 for 1.0035 with stop below 0.9735.

On the weekly chart, last week’s rebound formed a long white candlestick on the weekly chart, adding credence to our view that low has been formed at 0.9735 last month and mild upside bias remains for test of 0.9978-87 resistance, break there would confirm the pullback from 1.0039 has ended, bring a retest of 1.0039, above there would extend the rise from 0.9421 low to previous resistance at 1.0100-08, having said that, overbought condition should prevent sharp move beyond previous resistance at 1.0171 and 1.0200-10 should hold from here.

On the downside, although initial pullback to 0.9855-60 cannot be ruled out, price should stay well above support at 0.9730-35 and bring another rise later. A weekly close below there would defer and signal top is formed instead, this also suggest first leg of rebound from 0.9737 has ended and bring weakness to 0.9690-00, however, reckon support at 0.9642 would limit downside and price should stay above support at 0.9565 and the greenback shall stage another strong rebound next month.

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