USD/CHF 1H Chart 8/28/2012 2:55PM EDT
The 1H USD/CHF chart shows the pair breaking out of a consolidation (rising wedge) pattern that formed from the 0.9538 low on 8/23 to the 0.9635 high on 8/28 during the early Asian session. Through the rest of the 8/28 global session, the pair broke below the consolidation trendline, but has yet to test last week’s low of 0.9538.
Still the bearish break keeps the bearish outlook toward the 0.9450 and 0.9420 pivots seen on the daily chart. There is still a chance that the broken consolidation was just the 1st leg to a larger consolidation, which means, before breaking below 0.9538, another choppy structure toward the 0.9660 resistance pivot is very much a live scenario. Only a break above 0.97 and the declining trendline seen in the daily chart should introduce the bullish outlook.
A clear sign of bearish dominance in the near-term is if a pullback fails to break above the 0.9580 pivot area and the 1H RSI remains below 60, preferably below 50. A bearish move from there can be the leg that extends below 0.9538. I think with some elbow space, resistance can be around 0.96 as well, but a break above that makes the outlook very unclear.
The daily chart shows the 0.9450 support pivot lined up with the 50% retracement level, as well as the lower 0.9420 support pivot and June low. We should probably expect some demand here with upside back toward 0.9650/60.
USD/CHF Day Chart 8/28/2012 3:00PM EDT
Fan Yang CMT is a forex trader, analyst, educator and Chief Technical Strategist for FXTimes – provider of Forex News, Analysis, Education, Videos, Charts, and other trading resources.
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