CHF/JPY seems done with its climb as price formed a double top on its 1-hour chart. This is a classic reversal signal but price has yet to break below the neckline support at 111.00 to confirm the drop.

The 100 SMA is starting to cross below the longer-term 200 SMA to confirm that the path of least resistance is to the downside. This signals that the neckline is more likely to break than to hold. In that case, the pair could be in for a downtrend of the same height as the chart pattern, which spans 111.00 to 112.25.

However, RSI is on the move up to signal that buyers have the upper hand while sellers are taking a break. Similarly stochastic is pulling higher to confirm that bullish momentum is in play. If support holds, the pair could make another top at the 112.25 level.

The main catalyst for this pair this week might be the SNB decision, although no actual policy changes are expected. Any threats of currency intervention tend to drive the franc lower, especially as the central bank is keen on keeping the local currency weak to support exports.

Apart from that, the pickup in safe-haven demand last week favored the Japanese yen since the franc trailed the euro in selling off. The ECB announced plans to taper QE after September instead of cutting it off completely as many expected. Draghi also remained vague on the timing of their first rate hike.

With that, the yen could remain strongly supported versus the franc, particularly if trade tensions pick up. The yen was the main beneficiary of risk-off flows since there was still reluctance to buy the dollar. After all, trade tensions with its allies could hurt the US economy the hardest, although it would also dampen global growth.