USD/CHF 4H Chart 9/27/2012 8:55 AM EDT
0.9420 pivot: The USD/CHF has been in a corrective rally for the past couple of weeks, since finding support at 0.9238. The 1H chart shows a choppy market, but one that is making higher lows and higher highs. The 1H RSI reading has also been holding above 40 and tagging 70, a sign of persistent bullish momentum.
Rally rejected: However, this rally is now being challenged. 0.9420 is a key pivot. Was resistance on 9/13, and was support 6/20, each followed by a strong swing. So far, the 1H USD/CHF chart shows a market rejected from 0.9420. The bearish action so far is testing a trendline from last Friday’s low of 0.9285. A break below 0.9360, clearing below this trendline, exposes that 0.9285 low.
Bullish scenario: IF the market stays above 0.9350, and pushes back above 0.9420, is is extending the corrective rally. The next resistance cluster is in the 0.9484 – 0.95 area. There are support and resistance pivots, and a declining trendline as well as the 200-HR-SMA looming there. This will be the last line of defense before the bullish action switches from corrective mode, to breakout mode.
USD/CHF Daily Chart 7:12AM 9/24/2012
Fan Yang CMT is a forex trader, analyst, educator and Chief Technical Strategist for FXTimes – provider of Forex News, Analysis, Education, Videos, Charts, and other trading resources.
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