USD/CHF rebounds on 1.0050; risks still to the upside.
USD/CHF rebounded on the 1.0050 support level in the preceding week, jumping above the 23.6% Fibonacci retracement level of the upward movement from 0.9540 to 1.0235, around 1.0070. The RSI has come off from negative levels and the stochastic oscillator posted a bullish cross within its %K and %D lines in the oversold zone, pointing to some upside risks. However, the red Tenkan-sen line of the Ichimoku cloud is still sloping down despite the latest upside moves.
If the pair gains some more positive momentum and surpasses the 1.0125 resistance and the 20-day moving average, the next target for the bulls would be the 27-month high of 1.0235 before aiming for the 1.0340 level, taken from the peaks on January 2017.
On the other side, in case of a drift downwards, immediate support is likely to come from the 23.6% Fibonacci of 1.0070 and the 1.0050 low around the uptrend line. Falling below the diagonal line, the risk would shift from the current bullish outlook in the medium-term to a neutral one, challenging the 38.2% Fibonacci of 0.9970.
In brief, USD/CHF has been developing in an upside tendency over the last year and traders should continue positive orders until a significant violation of the ascending trend line near 1.0030.
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