USDCHF Analysis: Strong resistance likely at 0.9945
Yesterday’s signals were not triggered, as there was no bearish price action at 0.9915.
Today’s USD/CHF Signals
Risk 0.50%.
Trades may only be entered before 5pm London time today.
Short Trade Ideas
⦁ Go short following a bearish price action reversal upon the next touch of 0.9945 or 0.9969.
⦁ 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
⦁ Go long following a bullish price action reversal upon the next touch of 0.9915 or 0.9969.
⦁ 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 bulls should probably be looking for the price to get established above the confluent round number at 0.9900 before taking any long trades. I also thought that the price was unlikely to get higher than 0.9915 or 0.9945. I was basically correct to look to the long side, but I wanted to avoid this pair anyway.
The Dollar is generally bullish, and a weakening Euro has dragged down the Franc.
The most interesting technical feature on this chart is the descending trend line formed over the medium term which is shown below. This is now very confluent with the key resistance level at 0.9945 close by, so I think a short trade from a bearish reversal there could be a good trade entry opportunity. Another factor strengthening the case for that trade is that the price is here quite close to the parity area (1.0000) which has tended to act as long-term resistance for this very illiquid and frankly manipulated currency pair.
There is nothing of high importance due today concerning either the CHF or the USD.