USDCHF has reversed from the seven-week low of 0.9029 after the strong bearish move since September 25.
Further backing this short-term view are the Ichimoku lines and the upward slopes on the MACD oscillator which holds above its trigger line in the negative zone. However, for now the RSI and the 20- and 40-period simple moving averages (SMAs) are reflecting contradicting signals as all of them are pointing downwards.
If buying interest picks up, early tough resistance could occur at 0.9085, where the ceiling of the cloud also resides. A violation level may take the pair to challenge the 23.6% Fibonacci retracement level of the downward move from 0.9295 to 0.9029 at 0.9092. If advances endure past these obstacles, buyers may then target 0.9110, which overlaps with the 40-period SMA, before considering the 38.2% Fibonacci of 0.9130.
Otherwise, if sellers sink deeper, they could re-challenge the seven-week low of 0.9029. Steeper declines under this line would have to tackle 0.8995.
Overall, the very near-term picture remains positive above the seven-week low, while a break below it would cement negative worries again.
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