USD/CHF forecast

   The pair is forming the right shoulder of a “head and shoulders” trend-turning figure at current level 1.0685. It rebounds from the lower bound of “M-M+” daily sideways trend (1.0622) and rises above the “a-a+” downtrend, starting the transition of the downtrend/sideways pattern to an uptrend.

   The first sign of the trend’s turn was seen in the pair’s rising above level 1.0720 (getting over the higher bound of “a-a+” H4 downtrend), which cleared the road up to level 1.0775 (the higher bound of “H-H+” H4 downtrend). In case the pair rises above the latter level, next target will be set to 1.0860 (the higher bound of “M-M+” D1 sideways trend).

   Right now I can state that the pair will get to level 1.0860 within the next few days. For this reason I recommend buying from current levels with target set to 1.0860 and stop loss set to 1.0600.

 

 

   Starting from the previous forecast on daily graph I supposed that the pair would rebound from level 1.0750 (“Y” trend line – highly important trend line, which can not be passed easily) with a rising target set to 1.1245 – this forecast persists.

    The pair has been forming the “K-K+” sideways trend for two months since 06/01/09. On July, 21 the pair attempted to drop below this trend’s lower bound, but failed: the pair rebounded from the lower bound of “M-M+” daily sideways trend (level 1.0622) and, as a result, 3 signs of trend’s turn appeared on H4 graph. If an attempt to break the “K-K+” trend’s lower bound was successive, the pair would drop to support level 1.0330. However, such events progression is resisted by current picture over USD/CHF as well as by a complex picture over all the rest major currency pairs, which speak in favor of the dollar drop within the next two months (550 pips USD/CHF, 650 pips EUR/USD, 1000 pips GBP/USD).

   The uptrend may be empowered by the fact of rising above level 1.0775, and then of a very important key level 1.0900 (the higher bound of “M-M+” D1 sideways trend), rising above which will clear the road up to target level 1.1145–1.1245.

 

 

   The pair had broken the lower bound of “C-C+” trend and also bounced off the “E+” trend line, what implies dropping to “Y” trend line (1.0750), updating the minimum 1.0366, and further dropping to “Q” trend line – level 1.0010 (the graph is obsolete, that’s why the price is 1.1560 and “Q” trend line is missing on it).

 

 

   Bouncing off the “E-E+” trend’s higher bound and also leaving the “C-C+” trend (weekly graph) imply that minimum 1.0366 is meant to be updated, and then the pair is going to drop to “Q” trend line – level 1.0010 / 1.1000. After this level is reached, the pair is supposed to grow to approx. 1.1300 (“E+” trend line) and if this line gets broken, the “Wolf wave” model will take effect. The growth above level 1.1300 will state the completion of the 5th wave and beginning of the 6th one with the target of growth set to level 1.3200.