Short-Term USDCHF Elliott Wave Analysis

Published July 16th

The USDCHF Elliott wave action from mid February to the July high looks like an impulse. The entire minor wave A may be either complete at this point or show some extensions as part of its fifth wave. With or without an extension to the upside, we expect to see the most sizable correction since February kicking in soon. We’ll label that correction as wave B.

The followup swing in minor wave C could complete an Elliott wave pattern of multiple degrees.  We’ll need to “check the temperature” once the swing unfolds in order to get more hints about it. The section below depicts graphically that we could be dealing here with a leading diagonal or a third wave to the upside. Initially, both structures will manifest the same behavior. However, the diagonal typically diverges whereas the third wave typically speeds up.

Medium Term USDCHF Elliott Wave Analysis

Published April 29th, 2018

The USD/CHF choppy rebound from intermediate wave (4) morphed into a proper impulse. The currency pair is attempting a breakout of the green downtrend, which we’ve tracked for several months. The strength of the current advance is impressive. Upside momentum reached levels, which we have seen only twice during the past decade. At the same time, we see a heavily overcrowded trade against the US Dollar. All in all, strong arguments for a trend reversal in February 2018.

Long-Term USDCHF Elliott Wave Analysis

Published 20th, February 2018

Many traditional chartists describe the current long-term chart as “bottom building”. There are indeed opposing forces working against each other. On the on hand, we have a cycle trend, which finished in 2011. On the other hand, there is some formation building that will eventually resolve to the upside.

These days it is the old world vs. the new world in Switzerland. The old being the safe haven stable country that stays out of political crisis and wars. The perfect storage place for honesty and not honestly earned money. The new world brings first and foremost leverage into the game. The Swiss National Bank took on with or without a mandate the freedom to sterilize its forex holdings with risky assets. Their investment exceeds Swiss GDP.

Eventually, foreign investors who sought a safe haven will realize that the world is not going down but that their CHF is trending down. Unwinding their position will lead to a trend enforcement to the upside.

The USDCHF completed a long-term diagonal. It is cycle wave V and started in in the early 70s. 

We see the diagonal as completed with the drop in 2011. It looks like an overthrow, which reverted quickly. This is the end of cycle wave V! A secular bear market has started for the Swiss Franc against the US Dollar in 2011.

Technical Analysis