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USD/CHF Rebounds From Multi-Month Low - USD to Swiss Franc Price Forecast

USD/CHF Rebounds From Multi-Month Low - USD to Swiss Franc Price Forecast

Mahmoud Alkudsi, Analyst


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USD/CHF Technical Outlook

USD/CHF – Sellers Hold Fire

Last week, USD/CHF tumbled to 0.9613- its lowest level in nearly 16 months. However, the price rallied after as some sellers took profits. On Friday, the weekly candlestick closed in the red with 0.5% loss. This week, sellers resumed taking profit leading the price to rally further.

Alongside this, the Relative Strength Index (RSI) rose from 30 to 40 highlighting a weaker downtrend momentum.

USD/CHF Daily Price Chart (April 1, 2017 – JAN 20, 2020) Zoomed Out

usdchf daily price chart zoomed out 20-01-20
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USD/CHF Daily Price Chart (Aug 1 – JAN 20, 2020) Zoomed IN

usdchf daily price chart zoomed in 20-01-20

From the daily chart, we notice on Dec 12 USD/CHF started a downtrend move creating lower highs with lower lows. This led the price on Dec 27 to fall to a lower trading zone 0.9569 – 0.9788. Last week, the pair resumed bearish price action eyeing a test of the low end of the zone.

A close below the low end of the zone could embolden markets participants to press towards 0.9438. In that scenario, a special attention should be paid to the weekly support levels and area marked on the chart (zoomed in) as some traders could exit/ Join the market nearby these points.

In turn, a close above the high end of the zone reflects seller’s hesitation. This could push the price towards 0.9839. Further close above this level opens the way for buyers to lead the USDCHF towards 0.9921. That said, the weekly resistance levels printed on the chart would be worth monitoring.

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USD/CHF Daily Four-Hour Chart (DEC 20 – JAN 20, 2020)

usdchf four hour price chart 20-01-20

Looking at the four-hour chart, we notice on Jan 14 USD/CHF broke below the uptrend line originated form the Dec 31 low at 0.9646 and declined to near 16 months low. On Friday, the pair rebounded from the uptrend line. Thus, any violation to this line could be considered as a bullish signal.

A break above 0.9708 could lead USDCHF towards 0.9756. Yet, the resistance level underlined on the chart should be considered. On the other hand, a break below 0.9663 may send the pair towards 0.9646. Although, the daily support level underscored on the chart should be monitored.

See the chart to know more about the key technical levels in a further bullish/bearish scenario.

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Written By: Mahmoud Alkudsi

Please feel free to contact me on Twitter: @Malkudsi

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