Swiss Franc Weekly Update - May 20 close

EURCHF

The Euro-Swiss Franc reached our expected target and went below 1.2420 at the 161.8% daily extension, matching January and March lows. The level was broken and retested on Monday, and we are heading further down to our previous continuation targets of 1.2200 and 1.2100 (127% weekly extension and 138.2% extension at the bottom of the descending channel). I think the direction is clearly bearish for this pair, and that we will have to wait the price to reach the channel boundaries to evaluate the possibility of a bullish pull-back or reversal. Price is presently attempting to break down the round number 1.2300.

GBPCHF

The Pound-Swiss Franc stayed roughly inside the same range as the two previous weeks (1.4530/1.4130) this time ending on an engulfing bearish candle but with a higher low, and since the beginning of this week the price has remained in a tight consolidation above the 1.4200 round number, between the middle line of the daily Bollinger bands and the lower band. We might be building a double bottom here, however I would vouch, with caution, for a continuation of the downside in extension to around 1.3830/00. Should the double bottom theory hold, we would be aiming to a 38.2% retracement on the daily swing low, at 1.4530.

USDCHF

The Swissie pulled back to the downside giving back all gains on previous week and closing at about the same price, below round number 0.8800 but above the middle line of the daily Bollinger bands. It is presently still trading inside the same tight range of last week, between 0.8760 and 0.8860. There is no clear direction yet for this pair, which has failed to show a strong recovery but neither seems to be wanting to go lower. I think we will need to wait for the price to break outside of this range and it could go either to the lows at 0.8550 or to the highs at 0.8950/0.9000. I would stay away of this pair for a while until it steps out of its undecision, or trade the small range for shorter-term positions.