Yesterday’s signals were not triggered as the bullish price action at 1.0053 was insufficiently strong.
Today’s USD/CHF Signals
Risk 0.75%.
Trades may only be taken between 8am and 5pm London time today.
Short Trades
- Short entry following a bearish price action reversal upon the next touch of 1.0081 or 1.0093 or 1.0159.
- Put the stop loss 1 pip above the local swing high.
- Move the stop loss to break even once the trade is 20 pips in profit.
- Remove 50% of the position as profit when the price reaches 20 pips in profit and leave the remainder of the position to run.
Long Trades
- Long entry following a bullish price action reversal upon the next touch of 1.0053, 1.0034, or 0.9982.
- Put the stop loss 1 pip below the local swing low.
- Move the stop loss to break even once the trade is 20 pips in profit.
- Remove 50% of the position as profit when the price reaches 20 pips in profit and leave the remainder of the position to run.
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 yesterday that although the technical picture looked quite bearish, we were back in an area between 1.0050 and 1.0100 where there were several closely bunched support levels. If the price broke through all of them and ended the day below 1.0050, that would be a very bearish sign. I thought it was likely that some or all of these support levels were going to hold over the near term, so it would probably be wise not to trade short close to them.
The support at 1.0050 held, but all the support levels above it became invalidated and flipped to become new probable lower resistance levels – we already see 1.0068 acting as resistance now, but I do not want to use it yet.
The Swiss Franc has benefited from the “risk off” sentiment which dominates the market now, so it is likely that the price is going to fall further over the coming days. I would take a bearish bias if there are two consecutive hourly closes below 1.0050 which will probably be today’s pivotal point.
There is nothing important due today concerning either the CHF or the USD.