The USDCHF formation hints at the construction of a bearish intermediate (A)-(B)-(C) zigzag.
Impulse wave (A) and the bullish corrective wave (B) are fully complete.
Since November 2020, we have seen a decline in prices and the formation of an impulse wave (C). Currently, the first four parts of wave (C) are complete and now we see the development of the minor wave 5.
It is assumed that bears could send the market to the 0.868 area.
At that level, wave 5 will be at 61.8% of impulse 3.
An alternative scenario shows that corrective wave 4 is still under development as a simple zigzag.
In this case, the bearish correction ⓑ of the minute degree has recently been completed, so an increase in prices and the development of the minute impulse ⓒ is likely.
We could expect the market to rise to 0.895. At that level, minor correction 4 will be at 50% of impulse 3.
Finally, wave 5 could send the currency pair down below 0.875, formed by wave 3.
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