The USDCHF saw a sharp rebound after an earlier failed break below the swing area near 0.79197 in the European morning session, triggering a snap-back rally.

The pair has now reached its first resistance zone between 0.7938 and 0.7947 (the high reached 0.7848). A firm move above this area is needed to give buyers more control and momentum with a string of moving averages to be eyed IF the buyers are to take back more control..

If upside traction continues:

Next target: The swing area high at 0.7947
Followed by the 100-bar MA on the 4-hour chart at 0.7967
Then the 100- and 200-hour moving averages near 0.7986

The bounce has shifted the tone marginally back toward the buyers, but they must push through these resistance layers to turn the tide more convincingly. Absent that, and the sellers are still more in control.

ON the downside, the 0.79197 is the level for sellers to get and stay below. Remember, the USDCHF is trading at levels not seen since 2011. So these level are extremes.

As a result, the buyers need to show that they can take back control and keep control. Even with the rally last week taking the price to 0.80628, that was still short of the 38.2% of the move down from the May high.

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This article was written by Greg Michalowski at investinglive.com.