In comparison with the move higher from EUR/USD, USD/CHF illustrated its negative correlation with the major pair and crashed through it’s support at 0.9035, falling straight to the next level of support at 0.8910 this week. The pair is now situated well below the ascending daily, weekly and monthly trends that have buoyed price in recent weeks. Unfortunately for USD bulls, apart from bullish pullbacks, there is now very little encouragement to bolster hopes.
If price breaks and closes below the support at 0.8910 on the daily timeframe, then we would expect price to continue to fall further. Make sure to confirm a close on the daily timeframe, before jumping into any shorts. In the short-term it would also be feasible for price to exhibit some form of pullback. On the daily timeframe it could be argued that price is now situated within a falling wedge pattern, which can offer bullish encouragement. It may mean that price at least retraces back towards the upper boundary of the wedge. Any touch from the upper boundary of the wedge would then be decent shorting opportunities to enter the overall bearish trend.
If price breaks and closes below the support at 0.8910 on the daily timeframe, then we would expect price to continue to fall further. Make sure to confirm a close on the daily timeframe, before jumping into any shorts. In the short-term it would also be feasible for price to exhibit some form of pullback. On the daily timeframe it could be argued that price is now situated within a falling wedge pattern, which can offer bullish encouragement. It may mean that price at least retraces back towards the upper boundary of the wedge. Any touch from the upper boundary of the wedge would then be decent shorting opportunities to enter the overall bearish trend.