USD/CHF Weekly Outlook

After dipping to 1.1239 initially last wee, USD/CHF's rise from 1.1158 resumed and rose to as high as 1.1622. From a short term angle, initial bias remains on the upside this week as long as 1.1426 minor support holds. As discussed before, we're maintaining the view that correction from 1.1963 has completed at 1.1158. Break of 61.8% retracement of 1.1963 to 1.1158 at 1.1655 will add much credence to this case and bring retest of 1.1963 high. On the downside, however, below 1.1426 will flip intraday bias back to the downside and argues that price actions from 1.1158 might merely be corrective in nature. In other words, fall from 1.1963 is still in progress.

In the bigger picture, USD/CHF pulled back after completing an impulsive five wave rally from 1.0366 to 1.1964. Subsequent correction might have completed after drawing support from 50% retracement of 1.0366 to 1.1963 at 1.1165. Break of 1.1963 will confirm that whole rise from 1.0366 has resumed for retest of 1.2229 high. On the downside, though, below 1.1158 will indicate that fall from 1.1963 is still in progress but even in such case, downside is still expected to be contained above 1.0864 support and bring rise resumption. However, note that sustained break of 1.0864 will dampen this view and will turn focus to 1.0366 low.

In the longer term picture, a long term bottom is no doubt in place at 0.9634 with bullish convergence condition in daily MACD. USD/CHF failed to take out 55 months EMA again (now at 1.1972) and reversed again and thus giving no confirmation of long term reversal yet. Though, sustained trading above there will affirm the bullish case that long term trend in USD/CHF has reversed. Further break of 1.3283 will confirm underlying upside momentum and open up the possibility for retesting 1.8305 (00 high).

source: http://www.actionforex.com/action-insight/usdchf-outlook/usd%10chf-weekly-outlook-2009041184614/