USDCHF Elliott Waves Analysis

The Swiss National Bank (SNB ) action last year made the Swiss Franc surge higher making multi-year new highs against many currencies ( eur , gbp , jpy , aud , cad ) but it couldn’t do it against the US Dollar that’s why USDCHF managed to keep above 2011 low making it a sequence of higher lows , so while holding above that low the pair is still correcting a multi-decades cycle which will take years to end unless there is another surprise hiding around the corner.

Looking at USDCHF weekly chart we can argue that the first corrective leg from 2011 low has ended or it’s still missing 1 more push higher that’s why I’m presenting 2 scenarios explaining what could happen in the coming months :

If we consider the sharp drop last year as wave C of an expended flat in blue (X) then 27/11/2015 high 1.0326 ended black ((W)) at the 61.8% extension of blue (W)(X) which means the recent 5 waves drop ( Diagonal ) only ended red A and after finishing current red B the pair is expected to resume lower targeting blue (W) of black ((X)) around the weekly trend-line in the coming months.

USDCHF Weekly S1 USDCHF Daily S1

 

If we consider the sharp drop last year as wave C of an expended flat in blue (2) of a leading diagonal then 27/11/2015 high 1.0326 is only wave blue (3) and the pair after ending current wave red B it will resume lower in blue (4) which is expected to hold above the weekly trend-line before resuming higher to finish black ((A)) as the first leg of this big correction

USDCHF Weekly S2 USDCHF Daily S2


We can conclude that in short term USDCHF is approaching a top red B and it’s expected to show a move lower at least for a 3 waves pullback before we can decide the next move , so no matter what sequence will en B the next area to look for shorts is 0.9977 – 1.0052 with a first target around 0.9700 .

 USDCHF H4 25052016 USDCHF H4 25052016 S2

 ” Trade what you see not what you think “

AlienOvichO

Full time Trader & Analyst