USDCHF: Although USDJPY continues to hold on to its recovery tone while holding above the 0.9334 level, it faces the risk of a turn lower. This is coming on the back of a hammer candle formation the past week. However, it will have to break back below the 0.9334 level to end its upside risk and bring more declines towards the 0.9041 level with a cut through there allowing for more declines towards the 0.8929 level, its Feb 24’2012 low. Further down, support comes in at the 0.8890 level, its Nov 03’2011 low where a breach will call for further declines towards the 0.8700 level, its psycho level. The alternative scenario will be a return to the 0.9499 level where a violation will call for a run at the 0.9591 level. Its weekly RSI is bullish and pointing higher supporting this view. On the whole, the pair remains biased to the upside while holding above the 0.9334 level.
