USD/CHF Technical Outlook: Trading Around Critical Levels After CPI
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USD/CHF Technical Outlook
- USD/CHF is trading at its lowest levels since April on lower CPI reading
- There is support in the current vicinity and a little lower
USD/CHF Technical Outlook: Trading Around Critical Levels
USD/CHF has been extremely weak since the middle of July with only one real meaningful bounce during the nearly one month period. On today’s lower than expected CPI reading the dollar tanked and on that USD/CHF took out a couple of near-term levels.
The breaking of near-term levels has the 200-day MA in play at the moment with price having flushed below it briefly following the CPI release. It is currently trading above the long-term threshold, and will need to hold onto it if it is to be a successful test.
A rally from here and recapturing of the 9460/70 area will have solid support breached and regained, which could help forge a larger bottom. Adding to the current area as support is a small underside trend-line that could make up a large descending wedge pattern. It isn’t considered a major level of support, but nevertheless it is support.
If USD/CHF continues to fall from here there are some levels in the vicinity of 9370 to watch (along with a trend-line from Jan), but not as meaningful as current levels. The thinking is that if today’s low can hold and the 200-day moving average puts a floor in, USD/CHF may have at the least a tradeable low, if not an intermediate-term to longer type of low.
USD/CHF Daily Chart
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---Written by Paul Robinson, Market Analyst
You can follow Paul on Twitter at @PaulRobinsonFX
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.