USDCHF seems to have completed its corrective drop towards 0.9060 levels earlier and is looking to resume its rally. Over the medium term, bulls are expected to remain in control and push prices through 0.9250, 0.9500 and beyond.
USDCHF probable wave counts are as follows: The entire drop from 1.0237 through 0.9010 seems corrective, potential double zigzag. If the above structure is correct, USDCHF should rally towards 0.9800/0.9900 resistance over the next few weeks.
The drop through 0.9010 was the last lower degree wave within Wave C. The currency had produced a rally through 0.9161 levels, sub-dividing into 5 waves. Hence a lower degree Wave 1 might be in place between 0.9010 through 0.9161 levels respectively.
Going further, the drop towards 0.9060 levels seems corrective and might be labelled as potential Wave 2, of a similar degree. If the above proposed counts are correct, USDCHF should stay above 0.9010 and push higher towards 0.9250 at least.
Also note that lower degree Wave 2 (not labelled here), had found support from 0.9060, which is fibonacci 0.681 retracement of Wave 1. At the moment, USDCHF is drifting sideways but should soon terminate close to 0.9060 and resume higher.
Traders might be inclined to hold long positions initiated around 0.9060 mark, with a protective stop towards 0.9000 and projected targets towards 0.9500 at least. Only a consistent break below 0.9000 would delay matters further.
Technical Analysis Team
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