USD/CHF Rejects 4-Hour Double-Bottom
Shain Vernier • 2 min read
It has been a quiet day on the forex, highlighted by a vacant U.S. economic calendar. With only a few hours left in the session, the majors haven’t done much. Modest moves in the USD/CHF (+0.05%), GBP/USD (+0.07), and EUR/USD (-0.09%) pretty much sum up the light participation. For the USD/CHF, rates are well off intrasession highs and near a key Double-Bottom pattern on the four-hour chart.
On the news front, the lead story today has been a global resurgence of COVID-19. Citing an explosion of cases in India, health experts at the WHO are bracing for the worst. Safe-haven assets have shown heightened volatility from the new uncertainty, with the USD/CHF and gold holding firm. The USD/JPY is one of the day’s bigger movers, up more than 0.50% on the session.
For the second consecutive week, the U.S. economic calendar has been sparsely populated. However, business is due to pick up in the coming days. The action begins with Thursday’s release of U.S. GDP for Q1 2021. Consensus estimates have the figure coming in at 6.1%, up from 4.3%. In addition to Thursday’s GDP, Friday is scheduled to bring the release of Personal Income and PCE Price Index figures. These two reports are going to be important to our current view of inflation. So, while the majors are quiet now, we may see a few directional moves in the USD/CHF, EUR/USD, and GBP/USD by the weekend.
USD/CHF Tests Intraday Double-Bottom
It’s a choppy session for the Swissy, with rates selling off from intraday highs. Now, 0.9140 is in play following a rejection of the four-hour Double Bottom (0.9121-22).
Bottom Line: If we see the USD/CHF retest four-hour support at the Double Bottom, a late-session buying opportunity may come into view. Until the closing bell, I’ll be looking to buy in from the 0.9122 level. With an initial stop loss at 0.9109, this short-term scalp produces 8-10 pips on a sub-1:1 risk vs reward ratio.