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Midweek Run To Safe-Havens: USD/CHF On The Radar

The midweek run to safe havens extends to a second day as both gold and the Swiss franc extend previous gains. However, this is not a typical move to hedge exposure—equities continue to show strength led by the DJIA (+120) and the S&P 500 (+8). With bull runs in commodities and safe-haven currencies, the relevance of traditional correlations are fading.

USD/CHF Technical Outlook

In Tuesday’s trading plan for the Swissy, a short entry from a key Fibonacci retracement area was targeted. Price stalled at .9845 before the sell orders were hit at .9865. Since that time, the USD/CHF has fallen precipitously.

USD/CHF, Daily Chart

Missing out on a nice move is one of the toughest aspects of trading. But, it is important to have enough discipline to hold steady until the next trade presents itself. If not, Fear Of Missing Out (FOMO) ends up taking over the adopted trading strategy.

Here are the levels to watch for the remainder of the U.S. session:

  • Resistance(1): 20 Day EMA, .9800
  • Resistance(2): Bollinger MP, .9815
  • Support(1): Swing Low, .9699
  • Support(2): 62% Sept. Low/ Oct. High, .9656

Bottom Line: The area between .9699 and .9656 is highly likely to act as robust downside support. With price consolidating near the .9750 handle, it is improbable that these levels will come into play during today’s session.

Tomorrow’s U.S. CPI release may create enough participation to test this area. If these levels come into play during the CPI report, a setup may be available in the aftermath. Check back for ideas on how to trade this market and benefit from the action.

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Shain Vernier
US Analyst
Shain Vernier has spent over 7 years in the market as a professional futures, options and forex trader. He holds a B.Sc. in Business Finance from the University of Montana. Shain's career includes stretches with several proprietary trading firms in addition to actively managing his own accounts. Before joining FX Leaders, he worked as a market analyst and financial writer.
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