USD/CHF Technical Analysis – Further Selling Tipped Ahead
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- USD/CHF Technical Strategy: Flat
- Support: 0.8723 (50% Fib exp.), 0.8669 (61.8% Fib exp.)
- Resistance:0.8777 (38.2% Fib exp), 0.8844 (23.6% Fib exp.)
The US Dollar weakened for a fourth consecutive day against the Swiss Franc having reversed lower as expected after forming an Evening Star candlestick pattern. Sellers are now aiming to test the 50% Fibonacci expansion at 0.8723, with a break below that exposing the 61.8% level at 0.8669. Alternatively, a reversal back above the 38.2%.Fib at 0.8777 aims for the 23.6% expansion at 0.8844
USD/CHF has lost a cumulative 1.8 percent over the past four days. Most analogous episodes of consecutive downside runs of comparable magnitude in the past year have been followed by significant recoveries. While this by no means guarantees an upswing and the chart certainly does not show a viable bullish reversal signal, we are bit leery to chase the pair lower by entering short at this point. As such, we will stand aside for now.
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.