USD/CHF Looking Weak Below Parity

One by one FX majors point towards a broader USD reversal, with the Swiss franc now coming onto our radar.

We can see on the weekly chart that USD/CHF has had a tough time above parity since October 2017. That’s not to say it hasn’t tried to hold above it, yet each time it has broken above this psychological round number it has rolled over again within days or weeks.

 

More recently we note the Swissy has failed to close above 1.0056 since printing a bearish pinbar at this level, and last week’s high marked a momentum shift prior to it crashing below parity once more.  Therefore, we see further downside as quite likely at this stage.

Switching to the four-hour chart shows momentum is clearly bearish and its decline has made light work of 0.9955 support. However, as it is extended beyond its lower Keltner band and RSI is heavily oversold the pair could be at risk of mean reverting before losses continue. Therefore, it could pay to wait for prices to retrace or at least stabilise further to avoid entering the move too late. So we’re keeping an eye on the 0.9938/55 resistance zone as a retracement here may provide a better opportunity to enter short. However, given the bearish connotations from the weekly chart, we’re looking for this to head towards 0.9848 further out.

 

Faraday Research offers real time FX and Equity trade signals from qualified analysts. Click here to try us free.

 

CLICK HERE TO REGISTER FOR FREE ON ADVFN, the world's leading stocks and shares information website, provides the private investor with all the latest high-tech trading tools and includes live price data streaming, stock quotes and the option to access 'Level 2' data on all of the world's key exchanges (LSE, NYSE, NASDAQ, Euronext etc).

Follow @FaradayResearch

This area of the ADVFN.com site is for independent financial commentary. These blogs are provided by independent authors via a common carrier platform and do not represent the opinions of ADVFN Plc. ADVFN Plc does not monitor, approve, endorse or exert editorial control over these articles and does not therefore accept responsibility for or make any warranties in connection with or recommend that you or any third party rely on such information. The information available at ADVFN.com is for your general information and use and is not intended to address your particular requirements. In particular, the information does not constitute any form of advice or recommendation by ADVFN.COM and is not intended to be relied upon by users in making (or refraining from making) any investment decisions. Authors may or may not have positions in stocks that they are discussing but it should be considered very likely that their opinions are aligned with their trading and that they hold positions in companies, forex, commodities and other instruments they discuss.

WHAT IS ADVFN?

ADVFN covers all things stock market.

From the news and opinion pieces on pages like this to share discussion forums, charting tools, financials, live share prices and Level 2, order book data

If you trade or invest ADVFN has the tools you need to make the right decisions.

• 

  101 Ways to Pick Stock Market Winners

  You need the number one bestselling investment guide, the definitive text for day traders, investors and stock pickers.

• 

  The Death of Wealth

  Dissecting the global economy and the financial markets, the book lays out the evidence for the next economic game changer: the Death of Wealth.

• 

  Anton F Balint

• 

  Fat Prophets

• 

  Glenmore Investments

• 

  Dan Atkinson