In the week of May 23-27, USD/CHF continued its downward movement at almost the same pace as in the previous week. Now it has become clear that this decline is not a correction but a reversal. It's nice to see that my recommendations from last week to sell the pair turned out to be correct. Let's focus on the price charts and start with the weekly time frame.
Weekly chart
The Swiss franc has been posting notable gains against the US dollar for the second week in a row. The last candlestick has almost no upper shadow which means that the bulls gave up and did not even fight back. As a result, the price slipped below the red Tenkan line and the blue Kijun line of the Ichimoku Indicator as well as below the Fibonacci levels of 38.2 and 50.0 from the higher range of 0.9090-1.0062. The pair closed the weekly session slightly below the Kijun line and the 50% Fibonacci level. Today, the price made a pullback towards these levels. If the pair bulls manage to recover after such a strong two-week fall, we can expect a white candlestick with the closing price below or above the Tenkan line. In the second case, the pair may continue to rise towards a strong technical zone of 0.9700-0.9750. If the bearish scenario continues, the pair may fall to the 61.8 Fibo level and the orange 200-day exponential moving average located at 0.9426. To sum it up, the downtrend is very likely to continue although it may be preceded by a correction.
Daily chart
On the daily chart, the pair broke through the blue Kijun line which earlier served as support. The 50-day simple moving average is acting as resistance at the moment. Even if the price breaks through the 50-day MA, it still has the support from the black 89-day exponential moving average located slightly lower. Notably, the 89 EMA is located right under the important psychological and technical level of 0.9500. If the pair reaches this level and bounces off it forming a bullish candlestick pattern, this will be a signal to buy USD/CHF. However, in my opinion, the main strategy for now is to sell the dollar/franc pair after corrective pullbacks to the levels of 0.9583, 0.9605, and possibly 0.9675. Recently, Thomas Jordan, the Chairman of the Swiss National Bank, reminded traders that the regulator could intervene in the foreign exchange market at any moment. The central bank clearly does not like the strengthening of its national currency. At the moment, the USD/CHF pair is trading at fairly good levels. However, I still recommend placing stop-loss orders when opening sell trades. Interventions performed by the SNB are a terrible thing for those who are selling the franc.
Good luck!