USDCHF – A wave 4 corrective pullback is underway
USDCHF has been in larger corrective uptrend since August’11 and it could test the 1.000/1.0700 resistance on multi-month basis (watch for strong 2005 monthly resistance line). The pair had completed a wave (A) at 0.9600 (Jan’12 high) and the following wave (B) was completed at 0.8930 (Feb’12 low). The current wave (C) uptrend could aim for 1.05 and above. The 0.9465/0.9420 support is critical for the uptrend followed by 0.9365.
A wave 4 setback is underway from 0.9975 which is supported by bearish divergences in daily oscillators. The 0.9870/0.9975 resistance should cap strength in the near term. A break below 0.9965 would extend the pullback toward the 0.9600/0.9465 support where short term bulls would attempt to fight back. We prefer to be near term sellers on bounce attempts. A reversal above 0.9975 however negates the near term bearish view and the key swing low at 0.9420 is the critical level for short term bulls.
Anantharajan .P, CMT (Technical Strategist, Precise Trader)
