USD/CHF Price Outlook: Key Support Level in Focus
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USD/CHF Technical Outlook
USD/CHF Price – Indecisive Traders
On June 11, USD/CHF tumbled to a three month-low at 0.9376. However, the price rallied after as some bears seemed to cover. Last week, the market traded without any clear direction therefore, the weekly candlestick closed with a Doji pattern reflecting trader’s indecision at this stage.
The Relative Strength Index (RSI) remained flat below 50 indicating a paused bearish momentum.
USD/CHF Daily Price Chart ( Sep 20, 2018 – June 24, 2020) Zoomed Out
USD/CHF Daily Price Chart (March 25 – June 24, 2020) Zoomed IN
In the first week of June, USD/CHF failed on multiple occasions to rally to the higher trading zone reflecting bulls weakness. Last week, the price rebounded from the high end of the current trading zone 0.9438 – 0.9548 indicating more weakness from the bull’s side.
Yesterday bears failed to press USDCHF to the lower trading zone nonetheless, it may require more failures to conclude a weakening bearish sentiment. Hence, a successful close below the low end of the current zone could send the pair towards 0.9330, and any further close below that level may encourage bears to press towards 0.9181.
On the flip-side, another failure in closing below the low end of the current zone reflects the bear’s hesitation and may cause a rally towards the high end of the current trading zone. Any further close above this level may extend the rally towards 0.9640.
See the daily chart (zoomed in) to know more about the key levels to monitor in both scenarios.
USD/CHF Daily Four-Hour Chart (June 7 – June 24, 2020)
On Monday, USD/CHF broke below the uptrend line originated from the June 16 low 0.9463, and generated a bearish signal. Another bearish signal would be produced if the price breaks below the uptrend line originated from the June 11 low at 0.9376 on the other hand, the pair would generate a bullish signal if breaks above the downtrend line originated from the June 8 high at 0.9639.
Thus, a break above 0.9501 may trigger a rally towards the high end of the current trading zone discussed above on the daily chart. In turn, any break below 0.9401 could send USDCHF towards 0.9330. That said, the daily support and resistance level marked on the chart should be considered.
Written By: Mahmoud Alkudsi, Market Analyst
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.