Overview:
USD/CHF trade with risks skewed lower. Intraday technical indicators are mixed and call for caution. We suggest long positions above 0.915 with targets at 0.9165 and 0.918 in extension. Below 0.9120 look for further downside, with 0.9100 and 0.9075 as targets, undermined by franc demand on buoyant CHF/JPY cross, broadly weaker demand for safe-haven USD as investor risk tolerance improves amid increased hopes for U.S. budget deal. But USD/CHF losses tempered by positions adjustment before weekend.
Preference:
Sell below 0.915 with targets 0.91 and 0.908.
Support Levels:
S1 - 0.91
S2 - 0.9080 (seven-and-a-half month low hit Dec. 20)
S3 - 0.9039 (May 1 low)
Alternative scenario:
Buy above 0.915. The upside breakout of 0.915 will open the way to 0.916 and 0.918.
Resistance Levels:
R1 - 0.9157 (Thursday's high), then at
R2 - 0.9179 band (Dec. 21 high)
R3 - 0.9194 band (Dec. 17 high)
Technical Comment:
The pair stands below its resistance and remains under pressure. Daily chart mixed as MACD & stochastics are in bearish mode; but five-day moving average is meandering sideways.