GBP/CHF Below 1.7500 Leads Us to Maintain a Bearish Outlook

[B]My picks:[/B] Stay short GBP/CHF to target 1.6750, stop above 1.7500
[B]Expertise:[/B] Fundamentals combined with technicals
[B]Average Time Frame of Trades:[/B] 1 day - 1 week

This is my pick from last Thursday, when GBP initially came under major pressure following news that S&P downgraded the UK’s credit rating outlook to negative from stable, though they did affirm their current long-term rating of AAA. Looking at GBP/CHF, heavy resistance looms above at 1.7500, where we have the February 2009 highs and early December 2008 lows, as well as a falling trendline connecting the November 2007, August 2008, and September 2008 highs. Given the worsening economic outlook for the UK as well as the technical picture, I think it may be worthwhile to stay short GBP/CHF with a stop above 1.7500 (psychological point). I’m looking toward the April 7, April 24, and May 11 lows near 1.6650 as a possible target, where we also see the 100 SMA.