FXstreet.com (Barcelona) - The Dollar's recovery against the Swiss Franc from 1.0260 has been capped at 1.0350 with the pair retreating to test 1.0300 level. Currently the pair is trading around 1.0300/10, 0.30% below today's opening price action at 1.0340.

According to James Chen, chief technical analyst at FX Solutions, the USD/CHF has formed a flag pattern in daily chart: In the case of USD/CHF, this potentially bullish flag formation occurs after a tentative bottom was established just below parity. The top of this flag conforms approximately to a downtrend resistance line extending from the March 2009 high. If the flag fulfills itself as a continuation pattern with an upside breakout, which would coincide with an upside breakout above the noted downtrend resistance line, an immediate upside resistance target resides in the 1.0550 price region.

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