Possible Long Trade For The USD/CHF
Shain Vernier • 1 min read
The USD continues to lag across the majors, marked by losses against Euro, Japanese yen, and Swiss franc. For the first time this week, the forex is showing signs of life. Today’s pronounced move by the Swissie has brought a trade setup into play for the remainder of the U.S. session.
Retracement is the word of the day for the USD. No matter which timeframe one references, the action for the USD/CHF has been bearish.
USD/CHF, Daily Chart
Horizontal price action has defined the USD/CHF for the past several weeks. The 62% yearly retracement of .9986 has served as a catalyst for market participation. Unfortunately, the initial short from this level proved ineffective amid the ECB fueled news cycle from a few weeks back.
Here are the key support and resistance levels for the remainder of the session:
Resistance(1): 62% yearly retracement, .9986
Support(1): 20 Day EMA, .9912
Support(2): Bollinger MP, .9896
Support(3): 38% retracement of October’s range, .9899
The Trade: I am a big fan of converging technical indicators. Three technicals fall in the support area from .9912 to .9896, forming considerable support. A long from .9912 with an initial stop beneath the Bollinger MP at .9889 is a 1:1 R/R trade that produces over a 20 pip profit.
These technicals are valid for the remainder of today’s forex session. Upon the open of Friday’s session, they will be recalculated. As always, trade smart and for tomorrow!