USDCHF Analysis: Support below 0.9900 still holding up
Yesterday’s signals were not triggered, as the bullish price action took place slightly below the support level identified at 0.9900.
Today’s USD/CHF Signals
Risk 0.50%.
Trades must be taken before 5pm London time today only.
Short Trade Ideas
- Short entry following a bearish price action reversal upon the next touch of 0.9950 or 0.9966.
- 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 ride.
Long Trade Ideas
- Long entry following a bullish price action reversal upon the next touch of 0.9991 or 0.9885 or 0.9975.
- 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 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 I had no strong confidence is the likely direction of the price, but I thought that if 0.9900 held as support, we would get at least a touch of 0.9950, which might then provide a good short-term trade entry opportunity. This wasn’t a bad call, as the level at 0.9900 did not hold as support.
Although the generally supportive area just below 0.9900 has continued to hold, the price is making lower and lower highs above that, and so although the zone stretches down to 0.9875, it looks ripe for a bearish breakdown. So, a break below 0.9875 could see a short trade opportunity. However, overall, direction here looks very uncertain, and so it should pay to be extremely cautious in trading this currency pair today.
I take no directional bias here now.
There is nothing of high importance due today concerning the CHF. Regarding the USD, there will be a release of ADP Non-Farm Employment Change data at 1:15pm London time, followed by the FOMC Statement and Federal Funds Rate at 7pm and the FOMC Press Conference half an hour after that.