Overview:
USD/CHF is trading in lower range. The rate is undermined by weaker USD sentiment; spillover from EUR strength on CHF; unwinding of CHF-funded carry trades amid increased risk aversion. But CHF sentiment dented by lower-than-expected Swiss January KOF economic indicator (came in at 1.05 vs. 1.18 forecast). Daily chart is negative-biased as MACD and stochastics are bearish; five-day moving average is below 15-day MA and falling.
Preference:
Sell below 0.914 with targets at 0.907 and 0.904 in extension.
Support levels:
S1 - 0.9075 (Jan. 2 low)
S2 - 0.9039 (May 1 low)
S3 - 0.8998 (April 2 low)
Alternative scenario:
Buy above 0.914. Above 0.914 look for further upside with 0.917 and 0.919 as targets.
Resistance levels:
R1 - 0.917
R2 - 0.919
R3 - 0.9234 (Wednesday's high)
Comment:
The pair has broken below a bearish channel lower boundary and remains on the downside, the RSI is turning down.
