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USD/CHF Technical Analysis: 2016 Range Resistance Awaits at .9949

USD/CHF Technical Analysis: 2016 Range Resistance Awaits at .9949

James Stanley, Senior Strategist

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Talking Points:

In our last article, we looked at the continued congestion in USD/CHF after the pair had surged up to fresh six-year highs in Mid-December. After a subsequent attempt to re-take those highs had failed just after the turn of the New Year, prices in USD/CHF have continued to head-lower without significant motivation. On the chart below, we’re looking at short-term price action in USD/CHF which still has yet to indicate strength in order to align with the longer-term trend. With this morning’s price action catching resistance off of old support (and also the 38.2% retracement of the post-Election move), traders would likely want to avoid moving forward with bullish strategies just yet.

USD/CHF Technical Analysis: 2016 Range Resistance Awaits at .9949

Chart prepared by James Stanley

The daily chart of USD/CHF, however, suggests that additional strength can be sought. Of particular interest is the zone of support from .9949 up to the parity level (1.0000), as this was a vitally important price action zone last year. The level at .9949 had helped to form range-resistance in USD/CHF throughout much of the second half of last year. This is also the 61.8% Fibonacci retracement of the major move in USD/CHF from the 2010 high to the 2011 low. And just a couple of pips below that at .9947, we have the 50% Fibonacci retracement of the post-Election move in the pair.

A support test in this region can open the door to bullish continuation strategies in the effort of trading an extension of the bullish move in the pair.

USD/CHF Technical Analysis: 2016 Range Resistance Awaits at .9949

Chart prepared by James Stanley

--- Written by James Stanley, Analyst for DailyFX.com

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Contact and follow James on Twitter: @JStanleyFX

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

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