The USDCHF pair has trended higher since testing 0.9293 support back on October 31st. Since then the pair has surged by 2.2% for the last two weeks. But, momentum may be running out for the major, as a rising wedge has emerged in the hourly charts.
With the formation of the rising wedge, a bearish pattern, the price action has already broken through downside support provided by the 0.9295-0.9380 ascending trendline. The penetration lower should set the pair up to test initial support at 0.9448 November 6th session high. The level is being reinforced by 0.9429 (38.2% fib support), which should momentarily halt the bearish decline.
However, should the pair retrace, it would still maintain its bearish bias. A positive correction higher would meet immediate resistance at 0.9493, which is being reinforced by the psychological 0.9500 round figure. The only way the bearish bias can be nullified is on an upside violation of topside resistance – currently residing at 0.9524.
Incidentally, the notion of a bearish decline is being supported by technical oscillators. Although short term price action is mildly oversold in stochastic, the bearish bias remains intact on a MACD Divergence.
Source: FXTrek Intellicharts