Further downside likely on USD/CHF, traders...
USD/CHF:
Down 0.16% on the day, Monday’s segment witnessed an influx of safe-haven demand for the Swiss franc based largely on global equities shedding ground. This – coupled with the US dollar index extending Friday’s losses sub 96.00 – marginally forced the H4 candles beyond a trend line resistance-turned support (extended from the high 1.0008) and came within a handful of pips of 0.99.
According to the overall technical picture, scope for further downside beyond 0.99 today/mid-week is a possibility. Factoring in weekly movement, we can visibly see a rather attractive bearish pin-bar pattern formed last week, just south of a 2016 yearly opening level at 1.0029. In support of the weekly timeframe’s bearish candlestick formation, daily price is fading notable resistance fixed at 0.9986. The history surrounding this level is particularly appealing (yellow), alongside the next support target on this scale not emerging until demand printed at 0.9800-0.9845. Therefore, the sellers are noticeably in the driving seat at the moment on the higher timeframes.
Areas of consideration:
Although both weekly and daily structure indicate further selling may be on the menu this week, an intraday bounce from the aforementioned H4 trend line resistance-turned support and nearby 0.99 handle could still be observed. Trading long from here, however, is a chancy move, knowing you’re potentially entering long into higher-timeframe flow.
Should the market ignore the above H4 supports and chalk up a H4 close below 0.99 that’s followed up with a retest as resistance, this is certainly of interest, targeting January’s opening level at 0.9838. There is a minor H4 demand present around 0.9883ish (red arrow), though given the higher-timeframe picture we feel this will likely be consumed. For conservative traders wishing to add a little more confirmation here, consider waiting for a bearish candlestick signal to form (preferably off the underside of 0.99 on the retest – entry/stop parameters can be defined according to this pattern) before pulling the trigger.
Today’s data points: US CB Consumer Confidence.
Down 0.16% on the day, Monday’s segment witnessed an influx of safe-haven demand for the Swiss franc based largely on global equities shedding ground. This – coupled with the US dollar index extending Friday’s losses sub 96.00 – marginally forced the H4 candles beyond a trend line resistance-turned support (extended from the high 1.0008) and came within a handful of pips of 0.99.
According to the overall technical picture, scope for further downside beyond 0.99 today/mid-week is a possibility. Factoring in weekly movement, we can visibly see a rather attractive bearish pin-bar pattern formed last week, just south of a 2016 yearly opening level at 1.0029. In support of the weekly timeframe’s bearish candlestick formation, daily price is fading notable resistance fixed at 0.9986. The history surrounding this level is particularly appealing (yellow), alongside the next support target on this scale not emerging until demand printed at 0.9800-0.9845. Therefore, the sellers are noticeably in the driving seat at the moment on the higher timeframes.
Areas of consideration:
Although both weekly and daily structure indicate further selling may be on the menu this week, an intraday bounce from the aforementioned H4 trend line resistance-turned support and nearby 0.99 handle could still be observed. Trading long from here, however, is a chancy move, knowing you’re potentially entering long into higher-timeframe flow.
Should the market ignore the above H4 supports and chalk up a H4 close below 0.99 that’s followed up with a retest as resistance, this is certainly of interest, targeting January’s opening level at 0.9838. There is a minor H4 demand present around 0.9883ish (red arrow), though given the higher-timeframe picture we feel this will likely be consumed. For conservative traders wishing to add a little more confirmation here, consider waiting for a bearish candlestick signal to form (preferably off the underside of 0.99 on the retest – entry/stop parameters can be defined according to this pattern) before pulling the trigger.
Today’s data points: US CB Consumer Confidence.
Penafian
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