GBP/CHF 1H Chart: Pair tended south

The Pound has been guided by two ascending channels against the Swiss Franc. The senior formation began a year ago, while the junior one has confined the rate since early October. The rate bounced off its four-month high of 1.3326 last Wednesday and has since returned near the 1.3115 mark.

As apparent on the chart, the rate has been testing the bottom boundary of the junior channel for the past week. This indicates that the Sterling could be ready to breach the given pattern to the downside. This move would be in line with the senior pattern.

It is possible that the nearest downside target is the weekly or monthly S1s at 1.2959 and 1.2910, respectively.

Nevertheless, technical indicators suggest that the Pound might still edge slightly higher in this session, possibly up to the 1.3258 mark prior to starting to move south.

Comment:

As it was expected the Pound bounced off the resistance of the dominant ascending channel pattern against the Swiss Franc. Moreover, recently a descending channel was spotted, which is set to guide the currency pair down to the 1.29 mark.

However, on its way the rate is still set to encounter the support of the 200– period simple moving average near 1.3010, the weekly S2 at 1.2974 and the combined support of the weekly S3 and monthly S1 at the 1.2915 mark.