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    Technical Analysis – USDCHF downside risk below 200-dma

    USDCHF broke below the 200-day moving average on Thursday, which was acting as support. This break has weakened the underlying bullish market structure. The pair had a daily close below the key 0.9700, which is also a 50% Fibonacci level of the upleg from 0.9077 to 1.0326 (May to November 2015 rise). This is a critical level and now acts as a resistance level for upside moves.

    RSI is negative in bearish territory below 50, which highlights the downside bias. Also, prices have fallen out of the lower bound of the Bollinger Band.

    If the market falls below the 61.8% Fibonacci (0.9554), this would open the path for prices to target the October low at 0.9475. Only a move back above the 200-day moving average and a daily close above it would shift the current downside bias.

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