USDCHF Analysis: More bearish below 0.9886
Yesterday’s signals were not triggered as there was insufficiently bullish price action at 0.9894.
Today’s USD/CHF Signals
Risk 0.50%.
Trades must be entered between 8am and 5pm London time today only.
Short Trade Ideas
⦁ Go short following a bearish price action reversal upon the next touch of 0.9908, 0.9915, 0.9931, or 0.9960.
⦁ Place the stop loss 1 pip above the local swing high.
⦁ Adjust the stop loss to break even once the trade is 20 pips in profit.
⦁ Take off 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 Idea
⦁ Go long following a bullish price action reversal upon the next touch of 0.9820.
⦁ Place the stop loss 1 pip below the local swing low.
⦁ Adjust the stop loss to break even once the trade is 20 pips in profit.
⦁ Take off 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 yesterday that I would do nothing here unless and until we got a bearish break below the support level at 0.9894, and I would then be prepared to take a bearish bias, as the price has a lot of room to fall below that price.
This has turned out to be a good call, as at the time of writing the price is making a strong break below that level and appears to have enough room to fall all the way to the nearest support at 0.9820.
As long as the short-term price action is bearish and the price is breaking to new lower lows, I will take a short-term bearish bias here. It should be worth being aware of the trend line at 0.9860 which may provide support before 0.9820 is reached.
There is nothing of high importance due today regarding the CHF. Concerning the USD, there will be a release of PPI data at 1:30pm London time, followed by testimony by the Chair of the Federal Reserve before Congress at 3pm.