Never miss a story from Martin Essex

Subscribe to receive daily updates on publications
Please enter valid First Name
Please fill out this field.
Please enter valid Last Name
Please fill out this field.
Please enter valid email
Please fill out this field.
Please select a country

I’d like to receive information from DailyFX and IG about trading opportunities and their products and services via email.

Please fill out this field.

Your Forecast Is Headed to Your Inbox

But don't just read our analysis - put it to the rest. Your forecast comes with a free demo account from our provider, IG, so you can try out trading with zero risk.

Your demo is preloaded with £10,000 virtual funds, which you can use to trade over 10,000 live global markets.

We'll email you login details shortly.

Learn More about Your Demo

You are subscribed to Martin Essex

You can manage your subscriptions by following the link in the footer of each email you will receive

An error occurred submitting your form.
Please try again later.

USDCHF price analysis:

  • The USDCHF price is close to channel support and the 1.00 parity level; a bounce now seems possible.
  • Meanwhile, retail traders are overwhelmingly short the pair and a contrarian view of crowd sentiment also suggests the outlook is bullish.

USDCHF chart positive

USDCHF is close to the lower bound of a rising channel that has been in place for the past two months and could well bounce from there. Moreover, at 1.0019 at the time of writing, it is not far from the 1.00 parity level, which is also likely to be difficult to break through.

If these supports hold, the likely targets are the February 15 high at 1.0090 and then the February 13/14 highs just under 1.01. However, to the downside, a break of trendline support could lead to a slide back to the February 10 low at 0.9985.

USDCHF Price Chart, Hourly Timeframe (December 17, 2018 – February 19, 2019)

Latest USDCHF price chart.

Chart by IG (You can click on it for a larger image)

Meanwhile, traders are exceptionally short the pair – expecting it to fall. Retail trader data show that just 21.6% of traders are net-long, with the ratio of traders short to long at a remarkable 3.64 to 1. In fact, traders have remained net-short since January 17, when USDCHF traded near 0.9811; the price has moved 2.4% higher since then. The number of traders net-long is 4.9% higher than yesterday and 0.8% lower than last week, while the number of traders net-short is 20.9% higher than yesterday and 122.3% higher than last week.

At DailyFX, we typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests USDCHF prices may rise. Traders are further net-short than yesterday and last week, and the combination of current sentiment and recent changes gives us a stronger USDCHF-bullish contrarian trading bias.

Resources to help you trade the forex markets:

Whether you are a new or an experienced trader, at DailyFX we have many resources to help you:

--- Written by Martin Essex, Analyst and Editor

Feel free to contact me via the comments section below, via email at martin.essex@ig.com or on Twitter @MartinSEssex