Technical Analysis – USDCHF remains negatively skewed despite slim progress

USDCHF seems to be capped by the upper Bollinger band around 0.8918 after the price faintly improved from the near 6-year bottom of 0.8757. Currently resting on the mid-Bollinger band, the pair is exhibiting a commanding bearish tone, something also conveyed within the falling simple moving averages (SMAs).

However, the short-term oscillators are transmitting mixed signals of directional momentum. The MACD is promoting further advances in price as it is rising above its red trigger line in the bearish region, while the negatively charged stochastic oscillator is promoting further deterioration in price. The upwards pointing RSI is struggling to maintain its upward drive above the 50 threshold.

If sellers steer the price beneath the mid-Bollinger band at 0.8850, the next downside constraints could arise at the lower Bollinger band at 0.8780. Hovering underneath this is a support band of 0.8757-0.8739, the former being the 71½-month low. Should the pair dive under the latter, which happens to be the 161.8% Fibonacci extension of the up leg from 0.9182 until 0.9900, the picture could dampen further sending the price to challenge the 176.4% Fibo extension of 0.8635.

Otherwise, if buyers drive the price above the tested 0.8918 level, they may next face the nearby 50-day SMA at 0.8954. In the event the bulls manage to also conquer the 0.8981-0.9009 resistance belt overhead, buyers' attempts to reach the 0.9093 high could then be challenged by the 100-day SMA at 0.9041.

Concluding, an overwhelmingly negative trend prevails in the short-to-medium-term timeframe. Yet, a push above the 0.9000 handle could start to inject some confidence in the pair.