Last Thursday’s signals were not triggered, as the price action at the resistance level of 0.9965 was insufficiently bearish, although it effectively capped the high of the day and has continued to hold since then.
Today’s USD/CHF Signals
Risk 0.75%.
Trades must be entered between 8am and 5pm London time today only.
Short Trades
Go short following a bearish price action reversal upon the next touch of 0.9965 or 1.0015.
Place the stop loss 1 pip above the local swing high.
Adjust the stop loss to break even once the trade is 20 pips in profit.
Take off 50% of the position as profit when the price reaches 20 pips in profit and leave the remainder of the position to ride.
Long Trade
Go long following a bullish price action reversal upon the next touch of 0.9892.
Place the stop loss 1 pip below the local swing low.
Adjust the stop loss to break even once the trade is 20 pips in profit.
Take off 50% of the position as profit when the price reaches 20 pips in profit and leave the remainder of the position to ride.
The best method to identify a classic “price action reversal” is for an hourly candle to close, such as a pin bar, a doji, an outside or even just an engulfing candle with a higher close. You can exploit these levels or zones by watching the price action that occurs at the given levels.
USD/CHF Analysis
I wrote last Thursday that I saw 0.9965 as the day’s likely pivotal point, but I also thought that we were quite likely to see a break above it. I was ready to take a cautiously bullish bias if the price can close above that level on above-average volatility for a couple of hours or be bearish if there was a strong rejection and reversal there.
This was a partially good call as the level was definitely pivotal, but unfortunately the bearish price action wasn’t quite strong enough.
There is no change to the technical picture. The price is staying close to 0.9965 which again looks increasingly likely to be broken to the upside. I would take a bullish bias if the price can close above it for two consecutive hours on above-average volatility. A reversal there may be good for a short trade: this is a well-defined pivotal point at 0.9965.
This pair is without any long-term trend so profit-taking should be done conservatively.
There is nothing of high importance due today concerning the CHF. Regarding the USD, there will be a release of Retail Sales data at 12:30pm London time followed by ISM Manufacturing PMI at 2pm.