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Hugo in HTO Trading,

USDCHF: Potential double bottom

Since the start of the year the currency lost more than 2.5% however last week rose more than 1.0% and made a phase change, going from a bearish to a recovery phase.

Last week the USDCHF initially fell but found enough support near the 200 week moving average to turn around and closed near the high of the week, yet closed within the previous week range, sign of slightly on the bullish side of neutral.

The Stochastic is showing bullish momentum however is still below the 50 mid line.

Expecting an upward move to a key level at 1.009 on a break above a weekly resistance at 0.9838 (scenario 1) but a bounce off the key level at 1.009 could drag the currency down to the previous weekly resistance that would turn into a weekly support at 0.9838 (scenario 2).