Forex Technical Update
The USD/CHF has been in a consolidation pattern since hitting 0.9220. The 4H chart shows that it has accelerated to the downside a bit this week, pushing the pair to the 50% retracement of the 0.90-0.9220 swing. As we approach 0.91, let's review the support factors here. The 61.8% retracement is at 0.9085, there is also a pivot at 0.9090, that acted as resistance during 3/29.
Also note that the 4H RSI reading is at 40. After 70, if the reading can hold above 40 (given some elbow space), there can still be bullish momentum. Otherwise, if the market falls below 0.9080 and the 4H RSI falls below 40, there is again no clear direction of the market.
The daily chart reflects this non-directional market as price is trading between a rising and declining trendline. You can say this is a triangle, and the market is nearing the apex. There is a slight bullish bias in that the market is trading above the 200 day SMA. However, the lower SMAs (100, 55, 21, reflect consolidation. A break to the upside of this triangle opens up 0.9330 pivot, then the 0.9570 high.
To the downside, we have support at 0.8930. If the market pushes below 0.89, and the RSI is pushed below 40 (after holding below 60), we would likely be observing a bearish attempt toward the support pivots near 0.8675 and more aggressively to 0.8565.
Fan Yang CMT is a trader, educator and the Chief Technical Strategist for FXTimes - provider of Forex News, Analysis, Education, Videos, Charts, and other trading resources.
Information and opinions contained in this report are for educational purposes only and do not constitute an investment advice. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness. FXTimes will not accept liability for any loss of profit or damage which may arise directly, indirectly or consequently from use of or reliance on the trading set-ups or any accompanying chart analysis.