Overview:
USD/CHF is consolidating with bearish bias after hitting six-day low of 0.9588 on Friday. The rate is undermined by flows to safe-haven franc as investors turn jittery that the Federal Reserve might reduce its stimulus measures sooner than expected. But USD/CHF losses tempered by comments from Swiss National Bank President Thomas Jordan last week that the SNB is open to weakening its currency further against the euro and would even consider negative interest rates if such moves were necessary. Daily chart is negative-biased as stochastics is falling from overbought; positive MACD histogram bars are contracting.
Trading recommendations:
The pair is trading below its pivot point. It is likely to trade in lower range as far as it remains below its pivot point. Short position is recommended with the first target at 0.9588 in view, breach of this target will move the pair further downward and you should expect the second target at 0.954. Pivot point stands at 0.9665. In case the price moves in the opposite direction and returns from its support and moves above its pivot point, then trading in higher range is the most favorable and buy position is recommended above its pivot with the first target at 0.9716 and the second target at 0.974.
Support levels:
S1 - 0.9588 (Friday's low)
S2 - 0.954
S3 - 0.9517 (May 14 low)
Resistance levels:
R1 - 0.9716 (Friday's high)
R2 - 0.974
R3 - 0.9775
