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Talking Points:
- USD/CHF Technical Strategy: Flat
- Support:0.9720, 0.9428, 0.9213
- Resistance: 0.9910, 1.0177, 1.0393
The US Dollar corrected lower after hitting a monthly high to retest recently broken resistance against the Swiss Franc. Near-term support is in the 0.9720-46 area (March 31 close, 14.6% Fibonacci expansion), with a break below that on a daily closing basis exposing the 0.9428-79 zone (38.2% Fib retracement, April 3 low). Alternatively, a move above the 23.6% expansion at 0.9910 clears the way for a challenge of the 1.0126-77 region (March 12 high, 38.2% level).
A long position seems compelling from a strictly technical point of view, but we will tactically pass on the opportunity. Erratic SNB monetary policy since the beginning of the year warns of significant underlying outsized volatility risk inherent to any CHF-linked exposure. As such, we will look for setups elsewhere.
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Daily Chart - Created Using FXCM Marketscope
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
