- The recent pullback from multi-month stalls on Monday, ahead of 0.9900 handle.
- Set-up gradually shifting in favour of bearish traders, though warrant some caution.
The USD/CHF pair edged higher during the Asian session on Tuesday, albeit struggled to extend the momentum further beyond the very important 200-day SMA and remained well within the overnight trading range.
Given the pair's inability to sustain above the parity mark and repeatedly failures near the 1.0025-30 supply zone, the price action now seems to suggest that the near-term bullish trajectory might have already run out of the steam.
Meanwhile, technical indicators on hourly charts have just started drifting into the negative territory and losing positive momentum on the daily chart, adding credence to a shift in the near-term bias in favour of bearish traders.
However, the fact that the pair has been trending higher along a short-term ascending trend-channel formation over the past two months or so warrant some caution before placing fresh bets for any further near-term depreciating move.
Hence, it will be prudent to wait for a sustained weakness below the trend-channel support, currently near the 0.9915-10 region, which if broken will confirm a bearish breakdown and set the stage for a slide towards 0.9860-55 support area.
On the flip side, the 0.9990 horizontal zone now seems to act as an immediate resistance, which if cleared might assist the pair to surpass the 1.0025-30 barrier and aim towards testing the trend-channel resistance near the 1.0075-80 region.
USD/CHF daily chart
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