Overview:

USD/CHF is expected to consolidate in a lower range after hitting near-two-month low at 0.8854 on Tuesday. It is supported by the contagion from weaker euro on CHF, profit-taking on long-CHF positions as caution sets in ahead of U.S. non-farm payrolls report on Thursday and loose Swiss National Bank's monetary policy. But CHF sentiment boosted by stronger-than-expected Switzerland June PMI of 54.0 (versus 52.5 forecast). USD/CHF gains are also tempered by the soft USD sentiment and franc demand on buoyant CHF/JPY cross and on soft EUR/CHF cross. Daily chart is still negative-biased as MACD is bearish, stochastics stays suppressed at oversold zone, five-day moving average is below 15-day MA and is declining.

Trading recommendation:

The pair is trading below its pivot point. It is likely to trade in a lower range as far as it remains below its pivot point. Short position is recommended with the first target at 0.8860. A breach of this target will move the pair further downwards to 0.8840. The pivot point stands at 0.8905. In case the price moves in the opposite direction and bounces back from the support level, and then it moves above its pivot point. It is likely to move further to the upside. In that scenario, a long position is recommended with the first target at 0.8925 and the second target at 0.8940.

Resistance levels:
0.8925
0.8940
0.8955

Support levels:
0.8860
0.8840
0.8815