USD/CHF scope for further pullbacks – Commerzbank

The pair could see its downside renewed ahead of another leg lower, suggested Karen Jones, Head of FICC Technical Analysis at Commerzbank.

Key Quotes

“USD/CHF has held the initial test of the 23.6% retracement at 1.0050 and we have seen a small bounce from here. This is not enough to restore the up move and we would allow for a deeper correction lower ahead of resumption of the up move. Below 1.0050 lies the 38.2% retracement and May high at .9956/55. We note that the daily Elliott wave is suggesting a move to 1.0015/.9970 ahead of recovery”.

“Intraday Elliott wave counts are suggesting that rallies should now struggle circa 1.0120 ahead of the 1.0205 recent high. Above 1.0205 lies the 1.0256/1.0328 2015 highs. The 1.0328 level is regarded as a major break up point to the 1.0910 61.8% retracement of the move down from 2005”.