Previous: USD/CHF Falls Below Pivot at 0.93; Retracement Targets (1/23)
USD/CHF
The USD/CHF has stalled after breaking below 0.93, and found support at the 0.9240 pivot established 12/21/2011. Before looking at further decline, the market looks like it has completed a bear run, and may be ready for a bull cycle before deciding whether to extend the short-term bearish trend or not. Note that there is a bullish divergence. But what will the market need to do to bring on a bull run in the short-term? Let’s take a closer look at the 1H chart to look for clues.
The 1H chart below shows the market in a sideways consolidation during the 1/24 session. As we start the 1/25 Asian session, the bearish momentum is still maintained, reflected by the RSI reading staying below 60. However, it has not broken back below 40 neither. IF the market pushes above the 23.6% retracement of 0.9572 to 0.9224, at 0.9314, and pushes the RSI above 60, we could be looking at a more significant correction toward 0.94, which is 50% retracement, and also 200 hour SMA, as well as 200 4H SMA. If the market breaks above 0.94 (a central pivot of a range ), it would appear that the market is sideways instead of bearish, and a retest of some common recent highs near 0.9560 could be anticipated.
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Fan Yang CMT is the Chief Technical Strategist of IBTRADE and 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.
