Weekly
• Last Candlesticks pattern: Shooting star
• Time of formation: 7 Mar 2017
• Trend bias: Sideways
Daily
• Last Candlesticks pattern: Morning star
• Time of formation: 9 May 2017
• Trend bias: Near term up
USD/CHF – 0.9548
Although the greenback staged a strong rebound after marginal fall to 0.9421 earlier this month, as dollar met resistance at 0.9705 last week and has retreated, suggesting as long as this level holds, mild downside bias remains for another retreat, below 0.9545-50 would bring weakness to 0.9500 but break of 0.9455-60 is needed to retain bearishness and signal the rebound from 0.9421 has ended, bring retest of this level, break there would confirm recent decline from 1.0344 (2016 top) has resumed and extend weakness to 0.9390-00, then towards 0.9330-35, having said that, downside should be limited to previous support at 0.9259 and reckon 0.9220 (38.2% Fibonacci retracement of entire rise from 0.7401-1.0344) would hold.
On the upside, expect recovery to be limited to 0.9650 and bring another retreat. A break of said last week’s high at 0.9705 would risk a strong rebound to 0.9740-50 but only break of resistance at 0.9773 would signal the aforesaid decline from 1.0344 has ended, bring further subsequent gain to 0.9845-50 (61.8% Fibonacci retracement of 1.0108-0.9421), however, reckon upside would be limited to 0.9900-10 and price should falter well below psychological resistance at 1.0000.
Recommendation: Hold short entered at 0.9640 for 0.9400 with stop above 0.9705.
On the weekly chart, despite last week’s rebound to 0.9705 (a white candlestick was formed), as dollar met renewed selling interest there and has retreated, consolidation with downside bias is seen for weakness to 0.9550, then 0.9500 but break of 0.9455-60 is needed to signal rebound from 0.9421 has ended, bring retest of this level, break there would extend recent decline from 1.0344 top to 0.9350, then towards previous support at 0.9259, however, oversold condition should prevent sharp fall below 0.9220 (38.2% Fibonacci retracement of 0.7401-1.0344) and reckon 0.9150 would hold from here, risk from there is seen for a rebound later.
On the upside, as long as said resistance at 0.9705 holds, prospect of another decline remains. Above said resistance at 0.9705 would suggest a temporary low has been formed at 0.9421 and bring test of previous resistance at 0.9773 but a weekly close above this level is needed to add credence to this view, bring retracement of recent decline to 0.9845-50 (61.8% Fibonacci retracement of 1.0108-0.9421), then test of the lower Kumo (now at 0.9894) but upside should be limited to the upper Kumo (now at 0.9982), price should falter well below resistance at 1.0100-08.
