Clings to gains near multi-month highs around 61.8% Fibonacci level |

• USD / CHF gained strong positive traction for the second straight session on Wednesday.
• The bullish oscillators on the daily chart support the prospects for a further appreciation move.
• A move towards the 200 DMA, around the 0.9145 region, now seems like a clear possibility.

The pair USD/CHF it added to the strong bullish move the day before and gained some follow-up traction for the second straight session on Wednesday. The momentum pushed the pair to the highest level since early December 2020, around the 0.9085 zone.

The aforementioned region marks the 61.8% Fibonacci level of the 0.9297-0.8758 drop, which if cleared will set the stage for further gains. The USD / CHF pair could break above 0.9100 and aim to challenge the 200-day SMA, around the 0.9145 region.

Meanwhile, technical indicators on the daily chart remain in positive territory and still far from being in the overbought zone. However, the RSI on the 4-hour chart already shows intermittent overbought conditions and warrants some caution for the bulls.

This seemed to be the only factor preventing the bulls from placing new bets. Therefore, it will be prudent to wait for some subsequent purchases beyond the 61.8% Fibonacci level before traders begin to position themselves for any further short-term appreciation moves.

On the other hand, the 50% Fibonacci level, around the 0.9030 region, now appears to protect the immediate drop. This is followed by supports near the key 0.9000 level and support of the 100-day SMA, currently around the 0.8985-80 region.

The latter is approaching the 38.2% Fibonacci level and a subsequent decline will negate the constructive outlook. This, in turn, will set the stage for a drop towards the horizontal support at 0.8915 en route to the 23.6% Fibonacci level, around the 0.8885-80 region.

Daily chart

Technical levels