- USD/CHF has been trending lower along a three-day-old descending channel.
- The set-up supports prospects for a slide back towards the key 0.9000 mark.
- The descending channel resistance might cap any attempted recovery move.
The USD/CHF pair remained depressed for the fifth consecutive session on Tuesday and dropped to mid-0.9000s in the last hour. The mentioned levels marks the lower end of a three-day-old descending trend-channel, which should now act as a key pivotal point for intraday traders.
Meanwhile, technical indicators on hourly/daily charts maintained their bearish bias and are still far from being in the oversold territory. The set-up favours bearish traders and supports prospects for an extension of the recent rejection slide from the 0.9200 mark amid a broad-based USD weakness.
That said, the prevalent risk-on environment, which tends to undermine the safe-haven CHF, might help limit the downside. This makes it prudent to wait for some strong follow-through selling below the mentioned support before positioning for any further near-term depreciating move.
Bears might then aim back to challenge the key 0.9000 psychological mark, which if broken decisively will turn the pair vulnerable and pave the way for a slide towards the 0.8930-25 support. The downward trajectory could further get extended towards the 0.8900 mark en-route mid-0.8800s.
On the flip side, the descending channel resistance, around the 0.9085 region might keep a lid on any attempted recovery move. A sustained strength beyond, leading to a subsequent move above 100-hour SMA, around the 0.9100 mark, will negate the bearish bias and prompt some short-covering move.
The pair might then aim back towards conquering the 0.9200 mark hurdle, with some intermediate resistance near mid-0.9100s and 50-day SMA, around the 0.9185 region.
USD/CHF 1-hourly chart
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Technical levels to watch
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