USD/CHF is trading at 0.9720 and the outlook is somehow bullish as the USD is boosted by the USDX's rally. The currency pair is still located within an extended range, but the bulls seem to be strong enough to lead the price towards new highs in the weeks to come.

The pair increases after the last US data, the Flash Manufacturing PMI, and the Flash Services PMI have produced a big surprise, adding more buyers on this pair. USD/CHF has decreased in the short term only because the dollar index was into a minor correction.

The current sideways movement is obvious on the H4 chart, USD/CHF has found strong support on the outside sliding line (SL1) of the major descending pitchfork and now has jumped above the PP (0.9680) level.

The failure to approach and reach the S1 (0.9560) level, or to stabilize below the Pivot Point (0.9680) has signaled an increase towards the R1 (0.9775) level. Technically, USD/CHF is still expected to increase and approach the 0.9900 level after the failure to reach the median line (ML) and after the valid breakout from the descending pitchfork.

• USD/CHF Trading Tips

USD/CHF is almost to reach the 23.6% resistance, a valid breakout will confirm a further increase at least till the R1 (0.9775) level. The support is seen at the PP (0.9680) level and lower at the sliding line (SL1). The pair could increase towards the 0.9794 range resistance after the failure to approach again the 0.9591 pattern's support.

A valid breakout above the R1 (0.9775) could bring a buying opportunity, the next targets are seen at the first warning line (WL1) and higher at the 0.9900 level. The upside breakout from the extended range, above 0.9794, will suggest a broader increase towards the 1.0 psychological level.

We could search for selling opportunities if USD/CHF registers only false breakouts above the near-term resistance levels, or if the price registers another lower low.