Previous: USD/CHF Trading Up Near Consolidation Resistance of 0.9262 (2.17)

USD/CHF

After breaking above 0.9262 resistance, USD/CHF failed to extend beyond 0.93. From 0.93, the market slid to 0.9082, just below the previous consolidation support of 0.9088. Here we are seeing a bullish divergence. And even though the second low dipped lower, the 2 attempts can be seen as a double bottom. A break above 0.9150 completes the bottoming pattern.

Range-bound Outlook: A break above 0.92 shelves the bearish continuation scenario, and suggests a return to a sideways market. During the 2/21 US trading session, if the market breaks above 0.9150 and 0.9165 (38.2% retracement and 200 hour simple moving average), and then on a subsequent throwback stay above 0.9110, the bottoming process would still be valid, first opening up 0.92, and then opening up attack toward 0.9250-0.93 area again.

Bearish outlook: If the bull run at the moment fails to crack break above 0.9165, then the bearish outlook is still intact because this “double bottom” would actually be an expanded flat. This outlook is further confirmed if the RSI can stay below 60 in the 1H chart and push back below 40. Then a break below 0.9880 reflects bearish continuation with near-term pivot support at 0.9550 that opens up at least 0.88 when broken.

Fan Yang CMT is a forex trader, analyst, educator and main contributor for FXTimes – provider of Forex News, Analysis, Education, Videos, Charts, and other trading resources.

Information and opinions contained in this report are for educational purposes only and do not constitute an investment advice. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness. FXTimes will not accept liability for any loss of profit or damage which may arise directly, indirectly or consequently from use of or reliance on the trading set-ups or any accompanying chart analysis.