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USDCHF moves higher but runs into Fibo resistance


The USDCHF has moved above a target level at the 0.9640 area and has moved to new highs for the day at the 0.9681. The bias is bullish for the pair as it has broken through the 100 and 200 hour MA over the last few days as well as through 38.2% Fibo resistance and trendline resistance (see chart above).

The next key target is the 0.9683 level (reached 0.9681 today). That represents the 50% retracement of the move down from the December 2010 high to the low reached also in December 2010. So far, profit takers have come in against the level. This could be enough to pause the bullish bias for now.

I will be looking for support against the 0.9635-45 level now.  If the price can remain above this level the USDCHF has room to roam higher - keeping the bull run rolling.


Longer term, the USDCHF has been depressed for some time now as the CHF has been a safe haven currency. With the US showing some pretty good numbers, the safe haven idea is losing some momentum (at least from the perspective vs the US dollar).  This could./should lead to a test of the 100 day MA at some point.  The current 100 day MA comes in at the 0.9855 level. If the price of the USDCHF can remain above the downside support levels and continue to break through the upside targets like the 0.9683 level, the step by step process toward that target is where the pair should be heading.  It also would not be out of the question for the pair to retrace 38.2% of the move down from the 2010 high of 1.1729 to the December low.  That level is all the way up at 1.0228.  It seems impossible, but the longer term potential exists if the bias remains bullish and sentiment changes through a stronger US economy.