Key Levels For The USD/CHF
Shain Vernier • 2 min read
It is hard to argue that “risk-on” has recently become the preferred strategy of investors around the world. Equities indices are up, gold is down and the USD is posting a measured recovery against many of the majors. Unless we see a fundamental change in the market dynamic, it looks as though the fourth quarter of 2017 could be a great one for traders receptive to higher degrees of risk.
This sentiment is apparent in the current rally in the USD/CHF. Let’s take a look at the key levels moving forward.
Last week’s recommendation of a short in the USD/CHF turned out to be ill-fated, but not by much. The stop was hit at 1.0026, closing out the position. Ultimately, a high point of 1.0037 served as a reversal point for the market.
USD/CHF, Daily Chart
Undoubtedly, one of the most frustrating aspects of trading is getting stopped out before price moves into the green. All we can really do is chalk it up as a learning experience and journal the result. If premature stops become the norm, then it is time to adjust the trading plan.
For today’s pre-FOMC USD/CHF market, there are a few key support and resistance levels:
Resistance (1): Key Psyche Level, 1.0500
Resistance (2): 78% Yearly Fibonacci Retracement, 1.0134
Support (1): 62% Yearly Fibonacci Retracement, .9986
Support(2): 38% Fibonacci Retracement of Current Bull Run, .9922
Overview: We have talked about the FOMC meeting at length and the impact it may have on currency valuations. For now, I am going to wait for the release and adjust my strategy for tomorrow’s trade according to this afternoon’s price action.
Shorting the resistance levels will give us solid trade locations to profit from a pronounced northbound move. In the event that the USD/CHF rallies today, we will have several shorting scenarios for the Thursday and Friday sessions.
In the meantime, be sure to check out the trading signals page here at FX Leaders. Trade setups are available facing a wide variety of asset classes.