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  • USD/CHF stays depressed after refreshing multi-month low early in Asia.
  • Oversold RSI, nearness to wedge’s support line challenge bears.
  • 21-day SMA adds strength to the bullish formation’s resistance.

USD/CHF remains on the back foot around 0.8780, down 0.06% intraday, after declining to the fresh low since January 2015 during early Wednesday’s trading.

Although sustained trading below 21-day SMA joins US dollar weakness to keep USD/CHF sellers hopeful, support line of a bullish chart pattern, namely falling wedge, challenge the further downside amid oversold RSI conditions.

In a case where the stated trend line, at 0.8743 now, fails to stop USD/CHF bears, early 2014 bottom close to the 0.8700 threshold can entertain them ahead of highlighting 2015 bottom of 0.8365.

Meanwhile, corrective pullback needs to cross December 17 low near 0.8725 before challenging the 21-day SMA and upper line of the stated bullish formation, around 0.8855/60.

It should, however, be noted that an upside break of 0.8860 will signal the theoretical run-up towards the 0.9300 round-figure. During the uptrend, the November low near 0.8980 could be the key to watch.

USD/CHF daily chart

Trend: Pullback expected