(Chart courtesy of FX Solutions' FX AccuCharts. Price on 1st pane, Slow Stochastics on 2nd pane; horizontal support/resistance levels in yellow; uptrend lines in green; downtrend lines in red; 50-period simple moving average in light blue.)

5/20/2009 € USD/CHF € Price action on USD/CHF, a daily chart of which is shown, has descended to short-term support and is currently at a critical juncture. A strong break below this support (around the 1.0975 price region, which was the swing low hit last week) would confirm a bearish continuation of the steep downtrend that has prevailed in this pair since late April. In the event that this confirmation occurs, immediate further support resides around the 1.0850 price region. And immediately below that level resides dynamic support around a long-term uptrend support line that has been in place since March 2008. Any breakdown below this trendline would be a substantial bearish indication that should target yet further support in the 1.0700 region. Major upside resistance currently resides around the key 1.1100 price region.

James Chen, CMT
Chief Technical Strategist
FX Solutions

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