FXStreet notes that USD/CHF is posting small gains today, up 0.05% to 0.9390. Although some consolidation is expected at this level, a close below the key support at 0.9380 is on the cards, the Credit Suisse analyst team reports.

“USD/CHF has fallen back to the key support area at 0.9380/63 after failing to follow through on the sharp reversal higher and its bullish ‘reversal day’, which was on the back of the failure to close above 0.9459 as expected. Although a near-term consolidation phase should be allowed for at this point, we look for another attempt the break below this key support in due course.” 

“Beneath 0.9380 on a closing basis would negate the ‘reversal day’ as well as confirm a range breakdown, with support seen next at the 78.6% retracement of the June spike at 0.9337, where fresh buyers are expected at first for a fresh, short term pause.” 

“Resistance is seen initially at 0.9413, then 0.9425/30, above which would ease the immediate downside bias. Removal of here would see 0.9459/70, which ideally caps once more if reach. In contrast, a close above 0.9459/70 today would confirm a reversal from the range bottom.”