USD/CHF's break of 1.0399 support last week indicates that whole decline from 1.1729 has resumed. Short term outlook will now remain bearish as long as 1.0639 resistance holds. Current decline should target outer trend line support (0.9634, 0.9916, now at 1.0020). Nevertheless, note that break of 1.0639 will indicate that a short term bottom is at least formed and bring strong rebound.

In the bigger picture, USD/CHF is possibly in the process of forming a medium term sideway pattern that started as the long term bottom of 0.9634 (2008 low). The pair will continue to stay in converging range of 0.9634/1.2296 for a while. A break of either 0.9916 support or 1.1729 resistance is needed to indicate that USD/CHF is back into a directional trend. Otherwise, medium term outlook will remain neutral.

In the longer term picture, a long term bottom is no doubt in place at 0.9634 with bullish convergence condition in monthly MACD. But the current outlook is rather unclear. Firstly, USD/CHF is staying in convergence range of 0.9634/1.2296. Secondly USD/CHF lacks sustained buying to send it through 55 months EMA (now at 1.1394) decisively yet. We'd stay neutral first until a break out from the current medium term range.

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