USDCHF - Monthly long-term Overview

The Swissie broke down through March 2008 all-time lows and is now hovering around the break area testing if the level will hold as a resistance. The lower downtrend line has been confirmed on weekly charts and I would expect a pullback to the 50% Fibonacci retracement at 1.0590, but there are other steps to be attained and breached at 0.9900, 1.0130, 1.0330 and 1.0400. Weekly time frame looks like a bottom, however there is plenty of room on monthly charts for a further fall towards 0.8270-0.8300 at the lower downtrend line. Daily charts are showing a consolidation period after last week’s confirmed pin bar, and a return to parity is quite possible, medium term.

My views on this pair are bullish targeting a 38.2% Fibonacci retracement to 1.0330/40, with a longer term possibility of extension to 1.09-1.10 for a 61.8% pullback and attainment of the upper trend line of the descending weekly channel.

Daily assessment on Friday October 15, 2010 – at market’s close.

USDCHF	RES2	RES1	SUP 1	SUP 2	R/R	FORECAST	PRICE ACTION
Monthly	1.5772	1.1285	0.9641	0.9470	1:3	Bullish	Falling wedge
Weekly	1.2300	1.0426	0.9711	0.9529	1:3	Bearish	Descending triangle
Daily	1.1734	0.9814	0.9557	0.9514	1:2	Bullish	Ranging – small candles