USD/CHF's recovery from 1.0185 extended further to 1.0452 last week but momentum remained unconvincing. Subsequent retreat on Friday dragged 4 hours MACD below signal line and turned intraday outlook neutral. Some sideway trading might be seen initially this week. But after all, another rise is still in favor as long as 1.0282 minor support holds. Above 1.0452 will bring rise resumption to 1.0530 support turned resistance first. However, break of 1.0282 support will indicate that recovery from 1.0185 has completed and will flip intraday bias back to the downside for 1.0185 and possibly below.
In the bigger picture, whole set of price actions from 1.2296 are treated as correction to the medium term rally from 2008 low of 0.9634. Fall from 1.1963 is the third wave of such correction in form of five wave sequence (1.1158, 1.1740, 1.0590, 1.0883, 1.0185?). With 1.0530 resistance intact, there is no confirmation of bottoming yet. Nevertheless, even in case of another fall, USD/CHF should continue to lose downside downside momentum as it approaches key cluster support level of 1.001, 100% projection of 1.2296 to 1.0366 from 1.0883 at 1.0033, which is close to parity and finally bring reversal. On the upside, break of 1.0530 resistance will be an important signal that USD/CHF has already bottomed after missing 61.8% projection of 1.1740 to 1.0590 from 1.0883 at 1.0172 and will turn focus to 1.1021 resistance for confirmation.
In the longer term picture, a long term bottom is no doubt in place at 0.9634 with bullish convergence condition in daily MACD. USD/CHF failed to take out 55 months EMA and reversed again and thus gives no confirmation of long term reversal yet. We're neutral in the long term outlook for the moment and would wait for further evidence from the markets before making a stance.