Bank of America Merrill Lynch Research discusses CHF outlook and maintains a structural bearish bias looking to express that via selling CHF/JPY bounces into the the 111.80-113.25 area.
"One of our high conviction calls over the past 18 months has been for a weaker CHF....We think the broader trend of further CHF weakness is set to continue in the months ahead with longer-term relationships still suggesting marked overvaluation.
...We think this presents an opportunity to sell CHF rallies and buy JPY's dip and we reiterate our medium-term conviction in a lower CHF/JPY which also benefits from a favorable technical backdrop," BofAML argues.
"We think this cross can be sold in the 111.80-113.25 area, which is the medium-term technical resistance area. We think this could trend lower to retest the 2016 base in the +/- 103 area," BofAML advises.