Forex: USD/CHF Technical Analysis – Two-Month Support in Focus
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- USD/CHF Technical Strategy: Flat
- Support: 0.8831-48 (Dec’13 closing bottom, channel floor), 0.8798 (Dec 27 low)
- Resistance: 0.8902 (Jan 24 low), 0.8984 (trend line)
Prices pushed through support at 0.8902, the January 24 low, exposing the December 2013 closing bottom at 0.8848. This barrier is reinforced by a falling channel bottom at 0.8831. A break below the latter level on a daily closing basis targets the December 27 low at 0.8798. Alternatively, a turn back above 0.8902 aims for rising trend line support-turned-resistance at 0.8984.
Close proximity to two-month support makes chasing the pair lower by establishing a short at current levels unattractive from a risk/reward perspective. A clear-cut bullish reversal is absent however, arguing against the long side. We will continue to stand on the sidelines for now until an actionable setup presents itself.
Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.