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Technical analysis of USD/CHF for June 16, 2015


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USD/CHF is expected to consolidate with a bearish bias. It is undermined by weaker dollar sentiment (ICE spot dollar index last 94.83 versus 95.15 early Monday) after an unexpected 0.2% drop in the US May industrial production (versus forecast 0.2%), lower-than-expected May capacity utilization of 78.1% (versus forecast 78.3%), and surprising drop in the US Empire State's business conditions index to -1.98 in June from 3.09 in May (versus forecast for rise to 5.4). But USD/CHF losses are tempered by the negative Swiss interest rates and the threat of the Swiss National Bank CHF-selling intervention.

Technical comment:

The daily chart is negative-biased as the MACD is bearish, stochastics is reverting to bearish mode near oversold levels, although inside-day-range pattern was completed on Monday.

Trading recommendations:

The pair is trading above its pivot point. It is likely to trade in a wider range as long as it remains above its pivot point. As long as the price holds above its pivot point, long positions are recommended with the first target at 0.9360 and the second target at 0.9420. In the alternative scenario, short positions are recommended with the first target at 0.9210 if the price moves below its pivot points. A break of this target is likely to push the pair further downwards, and one may expect the second target at 0.9170. The pivot point is at 0.9250.

Resistance levels: 0.9360 0.9420 0.9475

Support levels: 0.9210 0.9170 0.9115

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