USDCHF continues its move to new lows

The next target for the pair comes in at the 0.8544 leel which represents the channel trendline in the hourly chart above.  A move below the trendline next targets the lower parellel trendline at the 0.8500 area.

USDCHF tests 38.2% Fibo retracement level

The USDCHF fell sharply in the early Asian session but has since enjoyed a trend-like move to the upside.  The step by step progression higher (see 5 minute chart above) initially found resistance against the 100 bar MA (blue line). After it broke above that, it paused at the 200 bar MA (green bar).  It broke through that and then tested the MA level on the correction. The ability to find buyers against the level and push higher has led to increased momentum with a high so far of 0.8795.

On a trend type move, it is not uncommon for the 38.2% retracement to play a more important role. That retracement can be on shorter legs as well. Remember..trends are fast. Trends are directional.  So waiting for a correction of the entire move can never occur.  As a result, I will target the shorter 38.2% of the most recent legs higher. If the level holds, this often gives the longs added confidence for the trend to continue. That level comes in currently at the 0.87729 level (see chart above). Stay above that and the bulls remain in charge.

Where are we going?  On the topside, the move has reached a key level on the hourly chart that needs to broken to encourage more buying (see chart  below). That level is the 38.2% retracement of the move down from the April 20th highat the 0.8799 level. A break above this level and then a  move above the 100 hour MA (blue line in the chart above)  at the 0.8813 level will give bulls the needed boost for a move higher.  However, don’t be surprised to see some profit taking against the key levels as well with stops above.  

Overall, the days trend remains in tact (above 0.87729) but don’t be surprised to see willing sellers on a next move higher as the market awaits Bernanke with 0.8799 and 0.8813 as key levels to breach.

USDCHF confined between trendlines

The USDCHF is confined by trendlines above and below. The downside trendline was just tested at the 0.8986 level and bounced higher. The topside has two trendlines to contend with. One is the trendline off the intraday highs in the hourly chart. That level comes in at the 0.9048 level. The next level is the trendline connecting highs from March 11th, 14th, and 16th. That level comes in at the 0.9065 level currently.

The CHF has been a safe haven currency with all the turmoil.  The move higher last night in sympathy with the JPY intervention, took the price up to the 38.2% retracement level at teh 0.9084. This remains a target should the price make it through trendline resistance levels. 

Having said that, until the price can get above these technical hurdles and ultimately the 100 hour MA (blue line in the chart above), the market players will be wary of the rally.  That does not mean, buying against a key technical level or buying on  break above a trendline is wrong. Those clues give bullish traders a “reason to trade”  (or be more confident in the position). It also makes bears more fearful. 

However, if the price fails at at resistance level, moves back below a breakout level,  it is not recommended to buck the trend the overall bearish bias. 

With the holding of support on the trendline for the 3rd time now, the dip buyers will likely be happy on dips toward support.  Getting through resistance above is the trade and if the price can push through, it is likely to gather more interested players.

USDCHF moves through trendline support but has retracement support close by

The USDCHF has moved lower on safe haven flows into the CHF. The price has moved through 100 hour MA, 200 hour MA (green line) the midpoint of the move March trading range and trendline resistance at the 0.9273.  The next target is the 61.8% of the March trading range at the 0.9265 level and this along with the trendline should slow the decline (or I expect some profit taking at the level). A break below the 0.9265 level however, should solicit some stop selling as the trend into CHF seems to be on traders minds.  Use the levels to lean against for trading clues.

On  the topside, the resistance should come in against the 100 hour MA at the 0.9293 and the underside of the trendline at the .09300.  Staying below these levels on a correction, keep the bears in charge.

USDCHF tests support at the December low

The 0.9342 level is the underside of the shallow trendline from the low.  The 0.9338 level is also a level to watch. It represents the 38.2% of the move down from the high today to the low for the day.   A move above that level will be eyed for increased upside potential.

Report on Mideast tension sends USDCHF even lower

There is a report/rumblings in the market that Iranian warships on the move in the Suez Canal toward Syria and Israel has said they would respond. As a result, the USDCHF has moved even more sharply lower on a flight into the safety of the CHF.  The plunge lower took the price below  channel trendline support  and the 200 hour MA (green line in the chart above) . The price, however, has rallied back higher and is back up testing the 200 hour MA (at 0.9634).  The underside of the upward sloping trendline comes in at the 0.9649 level. Staying below these levels, keeps the flight to safety trade in play (i.e. lower USDCHF).

Support in USDCHF fails and it is back down for the pair

The USDCHF fell back through support at the 09692-98 area and the price scoots lower.  The price is now down testing the midpoint of the days range at the 0.9676 level (see chart below). This level will be eyed for support buyers.

This is a key level to hold as the price has also dipped below the 100 day MA at the 0.9681 level. If support holds and the price moves back above the 0.9681 level, the selling may be over. If the 50% gives way, sellers should take control again on disappointment with the upward rally today.

USDCHF moves higher on Swiss government support

The USDCHF moved higher today and looks toward the next longer term targets . The price has moved higher on the back of the Swiss Government support for exporters and other industries such as tourism which are being hurt by the strength in the CHF.  Although the governments moves are designed to help as a result of the currency strength, the announcement has helped weaken the CHF in the process as well (at least for today).  The SNB tried unsuccessfully to stem the strength of the CHF in 2010, but has since abandoned such measures.

The move higher has pushed the price back above the 100 day MA after an earlier fall to support against the underside of the trendline (see daily chart above).  The key upside target for the pair now comes in at the 0.9803 level where the 38.2% Fibo Retracement of the move down from the August 2010 high to the Dec 2010 low comes in currently. Stay above the 100 day MA and the bias remains to the upside on a longer term basis.

Of the hourly chart, the price is approaching the weeks high at the 0.9744 level. This may slow the surge higher.  A break of the level will next target last Friday’s high at 0.9774.

On the downside for today, look for support at the 0.9713 level. This is the 61.8% of the move down from the Feb 11th high to the low today.  If this level can hold, the shorts/bulls should feel more confident about the move higher today.  A break of that level, howver, could see the price move down to the 0.9697 area. The underside of the trendline break, the 50% retracement and the 100 bar MA are all located in this area. This level should find stronger support today (see hourly chart below).

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