Forex: USD/CHF Technical Analysis – Edging Along Channel Barrier
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- USD/CHF Technical Strategy: Flat
- Support: 0.8813 (channel top), 0.8806 (23.6% Fib ret.)
- Resistance: 0.8873 (38.2% Fib ret.), 0.8927 (50% Fib ret.)
The US Dollar roseas expected against the Swiss Franc but the likely way forward is obscured by conflicting technical cues. In one scenario, a pullback from resistance at 0.8873, the 38.2% Fibonacci retracement, looks like a correction offering a long entry setup in the context of a falling channel breakout. In another, a bearish Evening Star candlestick pattern suggests a reversal lower is in progress.
We will stand aside for now, looking for clarification before committing to a directional bias. The bearish scenario would appear more probable following a daily close below the 0.8806-13 area, marked by the channel top and the 23.6% Fib. The bullish case would appear more compelling if prices produced a defined upside reversal signal at support.
Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com