ICmarkets

USD/CHF Technical outlook and review.

FX:USDCHF   U.S. Dollar / Swiss Franc
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Weekly Timeframe: A full-bodied bullish candle formed last week resulting in price trading relatively deep within a weekly supply area seen at 0.98378-0.95895. As per this timeframe, we are naturally expecting lower prices to be seen this week.

Daily Timeframe: At the time of writing, the daily timeframe is showing selling interest coming into the market within a daily supply area at 0.97505-0.96339. In the event this selling activity continues, it is very likely price will trade down towards at least the daily decision-point area coming in at 0.95163-0.95581.

4hr Timeframe: The market opened higher within the lower of the two stacked 4hr supply areas (0.97152-0.96744) at 0.96876. Regarding stacked supply areas, in our experience we have seen price trade to the ‘extreme’ areas more often than not. In this case, the extreme area would be the higher of the two coming in at 0.97505-0.97153.

Taking the above into consideration, if buying interest comes into the market around the small 4hr decision-point area seen at 0.96358-0.96603, this may be enough to allow price to rally higher up to the aforementioned 4hr (extreme) supply area, which in turn will likely fill active sell orders lurking around the 0.97106 level. However, assuming price breaks below the 4hr decision-point area, price will very likely at least trade down towards the 0.96 level, where at which point, this could trigger active buy orders (0.96049) that may still push prices up to the extreme area of 4hr supply, but as always, only time will tell!

On a side note, any traders considering shorting the 0.97 level may want to take into account the aforementioned stacked supply area for stop-loss purposes, since a deep test of the round-number level will very likely be seen. The safest bet in our opinion would be to place stops above the extreme supply area around the 0.97582 level.

Buy/sell levels:

• Buy orders: 0.96049 (Predicative stop-loss orders seen at: 0.95828).

• Sell orders: 0.97106 (Predicative stop-loss orders seen at: 0.97592).

thanks for this post
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