Demand for the safe-haven Swiss franc diminished Thursday, despite global risk aversion plaguing markets. The US dollar index rallied to highs at 98.31, providing fresh impetus to the USD/CHF, conquering 0.94, and whipsawing through 0.95 to a 161.8 Fibonacci extension point at 0.9550, before pulling back into New York’s close at 0.9437.The relative strength index (RSI) failed to reach overbought status, hovering a touch north of 50.00.
Quasimodo support on the weekly timeframe at 0.9255 recently capped downside, albeit after a brief spell to lows at 0.9182 (levels not seen since June 2015). Further recovery on this timeframe saw resistance from 0.9447 make an appearance, while daily price also shows resistance entered the fold at 0.9542.
With weekly and daily timeframes underlining resistance, and exhibiting scope to explore lower prices, a test of 0.94 (H4) may be on the cards today. Entering long from this level, while it held beautifully as resistance, could only trigger a brief recovery.
A break lower, as the higher-timeframes suggest, is the more likely outcome, triggering bearish themes to 0.93, and then possibly weekly Quasimodo support at 0.9255.
Disclaimer: The information contained in this material is intended for general advice only.