USD/CHF posted a significant jump today and looks determined to climb much higher in the upcoming period. Is trading in the green after the yesterday’s impressive drop, right now we still need a confirmation that will start an important upside movement.

I’ve said in the previous weeks that we may have a minor consolidation before will climb towards new peaks. Needs to recapture more directional energy before will resume the rebound. USD dragged the pair higher as the USDX has managed to increase a little today.

The dollar index has increased again and is trying to approach the 93.50 psychological level after the failure to reach the 92.94 previous low. Maybe the index has come down only to recapture more directional energy before will really start another leg higher. An accumulation will signal a reversal on the USDX, the USD will dominate the currency market if the index will jump and will stabilize above the 93.81 level.

The CHF decreased, even if the Switzerland Trade Balance surged from 2.76B to 3.51B in July, beating the 2.88B estimate. On the other hand, the greenback increased ahead the US data release, the HPI may increase by 0.5%, more versus a 0.4% in the former reading period, while the Richmond Manufacturing Index could decrease from 14 to 11 points.

USD/CHF failed once again to close on the median line (ml) of the minor ascending pitchfork and could retest the median line (ml) of the minor descending pitchfork. You can see that is developing and Inverse Head and Shoulders, but this pattern is far from being confirmed.

Will increase further if will close and will stabilize above the median line (ml) of the descending pitchfork. Right now is very important to see what will happen on the USDX, only a further increase will help the USD/CAD to increase further.

Technically, the USD/CHF is expected to reach at least the upper median line (uml) of the minor ascending pitchfork, could also be attracted by the upper median line (uml) of the descending pitchfork.