AUD/CHF traded lower on Monday, after hitting resistance fractionally below 0.6585. The slide was stopped near the 0.6525 zone, and today, the rate consolidated near that barrier. Overall, the pair continues to trade in a sideways manner, between 0.6490 and 0.6585, and thus, we will consider the near-term outlook to be neutral for now.
In order to start examining the bullish case, we would like to see a strong break above the range’s upper end, at 0.6490. Such a move would confirm a forthcoming higher high and may initially aim for the high of June 16th, at 0.6620. If the bulls are not willing to stop there, a break higher may see scope for extensions towards the peak of June 10th at 0.6660. Another break, above 0.6660, could carry larger bullish implications, perhaps setting the stage for the high of the day before, at around 0.6740.
Looking at our short-term oscillators, we see that the RSI stands slightly below 50, but points east, while the MACD is flat near both its zero and trigger lines. Both indicators suggest a lack of directional momentum, which enhances even further our choice to stay sidelined for now.
On the downside, a dip below 0.6490 is needed before we start assessing whether the bears have gained the upper hand. This would signal the downside exit out of the range, and may initially aim for the 0.6455 or 0.6430 levels. If the slide does not end there, then the next stop may be near the 0.6370 territory, which provided strong support between May 27th and 29th.