USD/CHF slid during the European morning Friday after it hit resistance near the crossroads of the 0.9890 level and the prior upside support line taken from the low of the 16th of February. Bearing in mind that the pair is trading below that line, we would consider the short-term outlook to be negative for now.
However, we would like to see a clear dip below 0.9815 before we get confident on more bearish extensions. Such a break would confirm a forthcoming lower low on the 4-hour chart and could set the stage for our next support zone of 0.9765. If that barrier fails to stop the price from dropping further, then we may see sellers aiming for the 0.9735 line.
Looking at our short-term oscillators, we see that the RSI turned down after it hit its 50 line, while the MACD, already negative, has turned south as well and just touched its toe below its trigger line. These indicators detect negative momentum and support the case for USD/CHF to continue drifting lower for a while more.
On the upside, we would like to see a move back above the aforementioned upside support line before we abandon the bearish case. Something like that is likely to initially aim for the 0.9935 resistance level, the break of which could see scope for extensions towards the 0.9980 obstacle, defined by the peaks of the 23rd and 29th of May.
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