USD/CHF traded lower on Tuesday, after hitting resistance at 0.9182, the barrier which acted as the lower bound of the sideways range that contained most of the price action from November 26th until yesterday. Although this paints a somewhat negative picture, bearing in mind that we saw false dips below that barrier a few times, we prefer to wait for a dip below the low of November 30th, at 0.9156.
Such a break could carry strong bearish implications, perhaps paving the way towards the low of November 9th, at 0.9103, or the low of November 1st, at 0.9085. If neither barrier is able to halt the fall, then a break lower could see scope for extensions towards the 0.9050 territory, marked by the low of August 5th.
Taking a look at our short-term oscillators, we see that the RSI lies below 50, and turned down again, while the MACD runs below both its zero and trigger lines. Both indicators detect negative momentum and support the notion for some more declines in this exchange rate.
On the upside, we would like to see a decisive break back above the upper bound of the aforementioned range, at 0.9255 before we start examining the bullish case. Such a break would confirm a forthcoming higher high on the daily chart and may initially target the peak of December 7th, at 0.9275. A move higher may allow a test at the peak of December 15th, at 0.9295, the break of which could extend the advance towards the 0.9325 zone, marked by the inside swing low of November 25th. The next resistance may be the high of that same day, at 0.9360, or the peak of the day before, at 0.9373.
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