USDCHF Analysis: bearish as risk-off sentiment boosts Franc
Last Thursday’s signals were not triggered as none of the key levels were reached during the specified time.
Today’s USD/CHF Signals
Risk 0.75%.
Trades must be entered before 5pm London time today only.
Short Trades
Short entry following a bearish price action reversal upon the next touch of 1.0011 or 1.0033.
Put the stop loss 1 pip above the local swing high.
Move the stop loss to break even once the trade is 20 pips in profit.
Remove 50% of the position as profit when the price reaches 20 pips in profit and leave the remainder of the position to run.
Long Trade
Long entry immediately upon the next touch of 0.9892.
Put the stop loss 1 pip below the local swing low.
Move the stop loss to break even once the trade is 20 pips in profit.
Remove 50% of the position as profit when the price reaches 20 pips in profit and leave the remainder of the position to run.
The best method to identify a classic “price action reversal” is for an hourly candle to close, such as a pin bar, a doji, an outside or even just an engulfing candle with a higher close. You can exploit these levels or zones by watching the price action that occurs at the given levels.
USD/CHF Analysis
I wrote last Thursday that the picture had become very slightly more bullish, with the price rising relatively firmly from new support at 1.0053. We are now into the fourth day where it looked as if the dominant movement would be bullish.
I was ready to take a bullish bias if we got a retracement to 1.0052 and a firm bullish bounce there later. This scenario did not happen, so it was enough to keep out of trouble.
The picture has changed again and has now become much more bearish. Since the end of last week, market sentiment has become strongly risk-off as stock markets have continued to sell off. Safe havens have been boosted and the Swiss Franc has acted strongly as a safe haven. Recent hours have seen a key support level which was at 0.9982 invalidated, and there is now no obvious support until 0.9892 which is a long way below the current price.
These are all bearish signs. However, it is a new week and the start of the London or New York sessions could see a reversal in market sentiment, although this is unlikely. Therefore, I would take a bearish bias if the price closes below 0.9970 at 9am London time.
There is nothing important due today concerning the CHF. Regarding the USD, there will be a release of ISM Manufacturing PMI data at 3pm London time.