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USD/CHF is pushing hard into the key 0.8918/26 highs, above which would trigger a small base to confirm further corrective strength, the Credit Suisse analyst team informs.

Key quotes

“USD/CHF has been pushing hard into the key 0.8918/26 highs over the past couple of days, further increasing the risk of a base and the corrective recovery phase that we have been calling for. 

“A clear break above the December highs at 0.8918/26 would see a small intraday ‘head and shoulders’ base completed to open up further upside, with the next level at the 55-day average at 0.8947/64, then 0.9027/28, which is a cluster of medium term retracement levels. Its worth highlighting that the ‘measured base objective’ is at 0.9083, where we would look for a solid cap.” 

“Longer-term, we look for the core bear trend to take over again post a deeper setback, in line with the very large top from 2020 that remains in place. Therefore, we see support initially at 0.8856/40, an immediate break below which would lessen the basing risk and open up 0.8723/21, then the recent low at 0.8758.”