USD/CHF Technical Analysis – Passing on Short Trade Setup
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- USD/CHF Technical Strategy: Flat
- Support:0.8861 (38.2% Fib exp.), 0.8807 (50% Fib exp.)
- Resistance: 0.8928 (23.6% Fib exp.), 0.8981 (trend line)
The US Dollar turned sharply lower against the Swiss Franc having found resistance above the 0.90 figure. A break below support at 0.8928, the 23.6% Fibonacci expansion, has exposed the 38.2% level at 0.8861. A further push downward beyond that aims for the 50% Fib at 0.8807. Alternatively, a reversal back above 0.8928 will clear the way for a test of falling trend line resistance set from November 2013, now at 0.8981.
While a short position seems compelling from the technical and risk/reward perspectives, our long-term fundamental outlook calls for a broadly stronger US Dollar. Furthermore, the proximity of heavy event risk in the form of the US jobs report has us wary of committing to a directional bias. On balance, we will remain flat.
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.