USD/CHF is expected to go on with its downside movement. The pair broke short-term rising trend line support. The pair broke below a rising trend line, which emerged on Dec 30, and consolidated on the downside. The declining 20-period and 50-period moving averages are playing resistance roles and maintain the downside bias. Additionally, 1.0220 is playing a key resistance role, which should limit the upside potential. The minutes of the U.S. Federal Reserve's latest monetary policy meeting showed a less hawkish tone than expected by investors. The minutes stated, "Participants expected that, with gradual adjustments in the stance of monetary policy, economic activity would expand at a moderate pace and labor market conditions would strengthen somewhat further. Inflation was expected to rise to 2% over the medium term. Members agreed that there was heightened uncertainty about possible changes in fiscal and other economic policies as well as their effects."
As long as 1.0220 holds on the upside, look for a further drop toward 1.0140 and 1.0105 in extension.
Resistance levels: 1.0245, 1.0270, 1.0305
Support levels: 1.0140, 1.0105, 1.0075