USD/CHF Daily Chart 10/11/2012 8:35AM EDT
Trendline holds: The daily USD/CHF chart shows a market that just tested a falling trendline going back to the July-high of 0.9971. The rejection also shows the 200-day SMA as resistance. Can this be a sign of bearish continuation? If so, we would first focus on the 0.9238 support pivot. The next support pivot is seen around 0.9050.
Momentum: Looking at the 4H chart, we see that the RSI reading tagged 70 and is now falling back. If it can push under 40, we at least show a lost of bullish momentum, and therefore improve the case for the bearish continuation scenario. But if the 4H RSI holds above 40, and the USD/CHF bounces off 0.9330 near 61.8% retracement, the focus remains on the falling trendline.
A break above this trendline right now requires at least a break above 0.94. If this does develop, USD/CHF introduces a reversal back to the bullish mode in the short-term, with the medium term outlook either sideways or bullish.
USD/CHF 4H Chart 8:40AM EDT 10/1/2012
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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