USDCHF Analysis: Bullish retracement against trend continues
Yesterday’s signals were not triggered, as none of the key levels were reached during this time.
Today’s USD/CHF Signals
Risk 0.75%.
Trades may only be taken before 5pm London time today.
Short Trade
Go short following a bearish price action reversal upon the next touch of 0.9848.
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 Trades
Go long following a bullish price action reversal upon the next touch of 0.9793 or 0.9701.
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 yesterday that the Dollar was recovering and safe havens such as the Swiss Franc were weakening. I thought that this may well persist, but equally it might just be a temporary retracement within a bigger trend against the Dollar, so I would be prepared to take a bearish bias on this pair if we got a bearish failure and strong bearish bounce when the nearest resistance level of 0.9793 was reached.
The level was not reached until the Asian session, when the price broke above it quite easily, and it may well have turned to support now. A test of that level now from above should be revealing, if it holds up firmly, we can expect the price to continue to rise as there is no resistance until 0.9848 so I would take a bullish bias if we get that outcome. There has been a lot of activity in this pair lately so it will probably be one of the currency pairs worth keeping an eye on as long as the market continues to be so driven by risk-on vs. risk-off considerations.
There is nothing of high importance due today regarding the CHF. Concerning the USD, there will be a release of Final GDP data at 1:30pm London time.