The USD/CHF pair retreated a little in the short term but the upside pressure remains high. The price could extend its new swing higher anytime. After its strong upwards movement, a temporary retreat was natural. The rate tried to accumulate more bullish energy before jumping higher.
The USD remains bullish in the short term despite some poor US economic data during the week. Today, the Canadian retail sales data came in worse than expected. Fundamentally, the Switzerland Trade Balance was reported at 4.82B versus 4.23B expected yesterday, but the CHF remains sluggish in the short term.
USD/CHF flag formation
As you can see on the h1 chart, the price action developed a flag pattern (minor channel). Technically, this should represent a bullish formation. Now, it challenges the flag's resistance.
The 0.8672 former high represents a static resistance. As long as it stays below this level and under the minor downtrend line, the rate could extend its retreat.
USD/CHF outlook
Jumping and closing above 0.8672 represents a buying opportunity as the pair could resume its growth.
