Forex Technical Update

Previous: USD/CHF Knocking at 61.8% Retracement as Swing Projection Targets 78.6% (11/7)

USD/CHF

USD/CHF

The 4H USD/CHF chart indeed shows a market that rallied to the 78.6% retracement level (of downswing from 0.9315 to 0.8572), and was rejected on the dot, at 0.9156. In this time-frame, the momentum is still bullish, but we have a 3-point bearish divergence being resolved, so there is some very short-term bearish outlook. Still, price is trading above the 200 period simple moving average.

Looking at the 1H chart however, we see that the bullish momentum in the short-term is being challenged. The RSI is hovering above 40 entering the 11/10 US trading session, and the retacement is just above the 61.8% market of 0.9010. A break below 0.90 psychological pivot would make a case for flattening or even reversal to the downside, within the context of a medium term consolidation. A break below the 0.8922 pivot and then the rising trendline (seen more clearly on the 4H chart), as well as the 200SMA in both the 4H and 1H chart would make the case of a bearish outlook.

USD/CHF

Fan Yang CMT is the Chief Technical Strategist FXTimes - provider of Forex News, Analysis, Education, Videos, Charts, and other trading resources.