While the Swiss seems to have found some support on the charts, the currency did forge a quasidownsidebreakout and that could hint at more downside action in the days ahead. Clearly optimism toward theEuro zone and suspicion toward the pace of the US recovery combined to lift the Swiss to last week’s highs and itnow feels as if that sentiment has been reversed. We can’t rule out a slide back down to 1.12 at some point laterthis week.
Technical Outlook: The major trend has turned down with the cross over back below the 60-day movingaverage. Stochastics trending lower at midrange will tend to reinforce a move lower especially if support levelsare taken out. The close below the 18-day moving average is an indication the intermediate-term trend has turneddown. The close below the 1st swing support could weigh on the market. The next downside target is now at112.08. The next area of resistance is around 113.32 and 113.97, while 1st support hits today at 112.38 andbelow there at 112.08.