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Talking Points:
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USD/CHF Technical Strategy: Flat
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Support:0.8997, 0.8730, 0.8299
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Resistance: 0.9213, 0.9490, 0.9718
The US Dollar continued to sink against the Swiss Franc, with prices dropping to the lowest level in nearly four months. Near-term support is at 0.8997, the 61.8% Fibonacci retracement, with a break below that on a daily closing basis exposing the 76.4% level at 0.8730. Alternatively, a turn above the 50% Fib at 0.9213 clears the way for a test of the 0.9428-90 area (38.2% retracement, March 26 low).
While entering short is tempting from a purely technical perspective, we will tactically opt to stand aside. Erratic SNB policy moves since the beginning of the year imply a worrisome degree of outsized volatility risk in having exposure to anything CHF-related. As such, we prefer to stand aside.
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Daily Chart - Created Using FXCM Marketscope
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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