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USDCHF Scalp Setup Eyes Channel Support- Bullish Above 9080

USDCHF Scalp Setup Eyes Channel Support- Bullish Above 9080

2014-01-22 18:52:00
Michael Boutros, Strategist
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Talking Points

  • USDCHF stalls after achieving primary targets- 9153 resistance
  • Weekly opening range in focus- Break to validate near-term scalp bias
  • Broader outlook remains weighted to the topside above 8980

USDCHF Daily Chart

Forex_USDCHF_Scalp_Setup_Eyes_Channel_Support-_Bullish_Above_9080_body_CHF_DAILY.png, USDCHF Scalp Setup Eyes Channel Support- Bullish Above 9080

Chart Created Using FXCM Marketscope 2.0

Broader Technical Outlook

  • USDCHF achieves all three resistance objectives- 9153 resistance in focus (weekly high)
  • Primary objective 9188/98- Subsequent resistance targets at 9232 & 9313/16
  • Break sub weekly range low / Fib support at 9077/84 invalidates bullishscalp bias
  • Broader outlook remains weighted to the topside above- 8980
  • Momentum testing 60- Breach to validate bias
  • PendingRSI support trigger takes us out of long exposure
  • Event Risk: US Existing Home Sales on Tomorrow

USDCHF Scalp Chart

Forex_USDCHF_Scalp_Setup_Eyes_Channel_Support-_Bullish_Above_9080_body_CHF_SCALP.png, USDCHF Scalp Setup Eyes Channel Support- Bullish Above 9080

Notes: Half of our long exposure was booked at 9150 in DailyFX on Demand on Tuesday morning with the remainder of the trade getting stopped out on the move sub-9120. A brief break below trendline support dating back to the December lows was quickly recovered in pre-market trade today and our scalp bias continues to favor the topside while above the 9077/83 support region.

Note that the momentum signature has broadly held above the 40-theshold (supportive) and a breach above the weekly range high with RSI conviction puts us back on track with our initial objective eyed at 9188/98.

We will respect a break below the weekly range low with such a scenario invalidating our near-term bias and puts support targets into view at 9045 & 9024. Bottom line: the broader outlook remains constructive above 8980/88 and we will look to buy dips/breaks of resistance while above this threshold.

* It’s extremely important to give added consideration regarding the timing of intra-day scalps with the opening ranges on a session & hourly basis offering further clarity on intra-day biases.

Key Threshold Grid

Entry/Exit Targets

Timeframe

Level

Significance

Resistance Target 1

30min

9120

Soft Resistance / Pivot

Bearish Invalidation

30min

9153

78.6% Retracement / Weekly ORH

Break Target 1

Daily / 30min

9188/98

61.8% Ext / 38.2% & 88.6% Retraces

Break Target 2

Daily

9233

200DMA / (Nov High at 9249)

Break Target 3

Daily / 30min

9313/18

100% Ext / 50% Retracement

Bullish Invalidation

Daily / 30min

9077/84

61.8% Retrace / Weekly ORL / TL Support

Break Target 1

30min

9045

Soft Support / Pivot / Last Week’s ORH

Break Target 2

30min

9020/24

50% Retrace / Jan 2nd Swing High / 50DMA

Break Target 3

Daily / 30min

8980/88

Jan 2nd Close / Last Week’s ORL / Pivot

Break Target 4

30min

8935

61.8% Retracement

Average True Range

Daily (20)

69

Profit Targets 17-19pips

*ORH: Opening Range High

*ORL: Opening Range Low

Other Setups in Play:

---Written by Michael Boutros, Currency Strategist with DailyFX

For updates on this scalp and more setups follow him on Twitter @MBForex

To contact Michael email mboutros@dailyfx.com or Click Here to be added to his email distribution list

Join Michael for a Live Scalping Webinar this week on Thursday morning on DailyFX Plus (Exclusive of Live Clients) at 1230 GMT (8:30ET)

Interested in learning about Fibonacci? Watch this Video

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