Swiss Franc Weekly Overview - July 22 close

EURCHF

This was a bullish week for the Euro-Swissie, which bounced from the bottom line of the descending channel and ending on a strong rejection of round number 1.1900. We have a falling wedge forming and I would expect a further pullback to the 38.2% retracement level at around 1.2115/20 which is the top line of the wedge for a first target, with a break and continuation to the 50% retracement level at around 1.2335/50 near the middle line of the Bollinger bands on a second step and finally a break of the previous highs targeting the opposite trend line of the descending channel, in an area between 1.2700 and 1.2800.

The daily charts show a rejection on Friday at the middle line of the Bollinger bands and if the pin bar candle is confirmed I would expect a retest of the lows at round number 1.1400 and possibly an extension towards 1.1150/1.1050 before there is a turn back to the bullish side. Should we be bottoming out, some consolidation can occur with the pair ranging between 1.1400 and 1.1800.

GBPCHF

A steady fall saw a small pull back to about the middle of the descending channel last week on this pair, and my expectations are of a continuation in extension to the bottom line of the channel and 127% Fibonacci level at around 1.2315 / round number 1.2300 on a medium-term approach.

On the daily charts we can see a test and rejection from SMA34 and middle line of the Bollinger bands, ending Friday on a pin bar which if confirmed could bring the price to a retest of the lows around 1.3040 as first target, then an extension to the bottom line of the descending channel in an area between the 127% and 138.2% Fibonacci levels (1.2860/1.2790).

USDCHF

Price made a double bottom after the steeper fall that started last February, ending at about the middle line of the descending channel. I doubt that the price would break further down psychological number 0.8000 but we should be on alert with this pair as it is still heavily bearish. My expectations are for a pull back to the 0.8930 level (roughly a 50% retracement on this long swing low) reaching the previously broken bottom line and resistance near the SMA34.

However, the Swissie might have another attempt to the downside towards the bottom line of the descending channel on the daily charts to test the 0.8000 level before any reversal. Should the psychological level break, we might be heading towards 0.7820 in extension.