This is the weighted average USD. As it can be seen the first day of the New Year it touched the resistance. The first target which was the support shown in the chart has been missed by a few pips. I expect USD to be weakening again to visit the missed target and possibly go lower.
This is the weighted average CHF. In the worst case scenario if it falls further it cannot go lower more than 1% due to having very strong support.
Weaker USD plus Stronger CHF is what we need to go Short USDCHF.
Great analysis as usual with some good time given in advance to observe the market.
It has nicely consolidated for the last 16 hours and did not break above 1.0053 which leads me to believe that the max it can go is 1.01 on a spike before Powell speech today. Having Euro bottomed at 1.264 on oversold levels - there should be some profit taking and short coverage happening for the next 8 hours taking Eur/USD about 120-160 pip up and USD/CHF about the same down. It may not reach 0.983 today as projected on the chart but we can expect at least 100 pip move down. I have two positions sold on USD/CHF at 1.0045 today and am going to TP1 - 0.991 and second 0.983 in succession.
khansalarehsan
⋅
@Erland, Many thanks for your great comment mate. I think you are absolutely right. Adding to what you mentioned here I like GBPCHF short too. Have a look at the technical and see how beautifully it is ready for a fall. On USDCHF I am with you until 0.98
Erland
⋅
Good morning Ehsan,
Yes, DXY can max out at 97.7 bringing eur/usd a little lower thus usd/chf a little higher but that is it. Once it starts falling - it will drag gbp/chf down as well. gbp/chf still needs 1.295 to be touched or at least to consolidate just below it as 1H chart is not ready to fall keeping 4H chart on hold as well. Only D1 chart is ready to fall. Which again tells me that gbp/chf fall is later on today or in the next 48 hrs.
Made a small typo on previous post number for eur/usd - should read 1.1264.
Erland
⋅
At 11 GMT I noticed a change in situation - H1 has touched an uptrend line and did not go lower it also coincided with H4 support line and Ichimoku cloud support line. I also noticed Stoch divergence on H1.
And then I decided to exit at BE (since my sell was at 1.0045) and wait for a better entry since I had limited access to internet at that time and was not able to make a note here.
Looking now - H1 candles are outside the Bollinger bands which means a strong push up and even if it stops climbing now - it will continue to do so during Asian session most likely. 1.0128 is what price is targeting right now and bearish H4 ABCD and Harmonic patterns are still valid up to that price.
Since Eur/USD had next bearish D1 candle right after penetrating 1.126 support - it may provide USD with an extra strength to go lower for eur/usd to 1.113-1.115 and for usd/chf 1.0128. For this reason and preserving the funds it is best for me to be on the sidelines today until tomorrow to see the daily candle on both pairs. I have gained nor lost anything on usd/chf so far and even an entry at current price would benefit me more than leaving my sell which I closed at BE this morning.
In case daily candle makes a wick - I may consider opening a sell later on but based on what I see on H1 and H4 charts - this is too early to sell despite the fact that I see a bearish ABCD formation even on D1 chart.
The previous targets of 0.991 and 0.98 remain valid but I prefer reopening my positions at a higher level.
khansalarehsan
⋅
@Erland, Well done mate. Great job. We are in lose on this one now and I think you did a great job.
GBPCHF looks great but CHF on average can fall about one percent and that means USDCHF may rise a bit before falling. Same with GBPCHF but GBP is weaker than USD that is why GBPCHF falling but USDCHF is not.
Thanks for sharing your thoughts here
Erland
⋅
Good morning Ehsan,
gbp/chf is above 1.295 (the figure I mentioned 2 days ago which is had to touch). it did and went above making 1.295 a temporary support. There are attempts to rise further as on H4 chart price is sitting comfortably above MAs which is usually a sign of some additional rise. We need a full H4 candle closure under 1.295 to remove upward pressure. Keep in mind that many traders already believe that GBP has already priced every negative aspect possible and there are not many trying to sell it. It is currently fighting 1.298 resistance on H1 and it is best to wait and see for the price action confirmation as H1 and H4 are still not bearish although it is near it.
usd/chf is getting exhausted and the price is consolidating near resistance. What worries me is - H1 chart Stoch fell down too fast with only 15 pip drop. This is not a good sign for sellers yet. It needs to come back before selling.
khansalarehsan
⋅
@Erland, Morning mate. I totally agree. See GBPCHF here
The main difference between your analysis and my analysis is Timeframe. I normally look at D1 only and stay in trades for a longer period of time as I use lower leverage. This is very time consuming but works. Thanks for sharing your thoughts
Erland
⋅
Just to clarify - I always start off W1 and then I analyse D1 for validity. H1 and H4 are only used for a correct entry to give me an easy exit point in case market disagrees with me (like it did yesterday). I had a buy on eur/usd at 1.127 with target 1.14 SL at BE and a sell at usd/chf at 1.0045. usd/chf had to exit manually at BE, eur/usd BE was trigger later on yesterday. It is just the perfectionism I am used to :) and it indicated to me that USD is entering a different pattern now.
usd/chf W1 chart is still pointing up with RSI at perfect buy levels - 61, D1 is still not overbought - so capital preservation and earnings maximization forces me to wait. There is too much volatility due to us-china talks. My view is - I do not have to trade every day or every week.
Your position is correct, it only takes more time to wait for it to be hit.
Erland
⋅
After 4hrs of waiting I entered usd/chf sell again at 1.0085 with SL 1.01 as H1 started leaning down and in 4 hours was not able to make any new higher high. It is 30 pip in profit now and I'll move to BE once it moves below 1.0024. a bearish ABCD pattern on D1 I mentioned yesterday started to apply pressure and should push the price down to 0.991 in the next 3-4 sesions
gbp/chf fell below 1.295 and did not manage to go above MAs on H4 chart thus my entry was there as well. my first TP on gbp/chf is 1.26
eur/usd managed to keep above 1.125 and H4 is suggesting 1.1488 as a buying target. Today's data releases from US will give some pullback for DXY although I do not exclude the possibility to go to 97.7 which is a bigger resistance level. So I am taking due care of all positions involving USD selling.
It has nicely consolidated for the last 16 hours and did not break above 1.0053 which leads me to believe that the max it can go is 1.01 on a spike before Powell speech today. Having Euro bottomed at 1.264 on oversold levels - there should be some profit taking and short coverage happening for the next 8 hours taking Eur/USD about 120-160 pip up and USD/CHF about the same down. It may not reach 0.983 today as projected on the chart but we can expect at least 100 pip move down. I have two positions sold on USD/CHF at 1.0045 today and am going to TP1 - 0.991 and second 0.983 in succession.