Analys från DailyFX

USD/CHF Technical Analysis: Grinding-Higher, but Resistance Imposing

Published

9 år ago

1 december, 2016

DailyFX

To receive James Stanley’s Analysis directly via email, please sign up here.

Talking Points:

USD/CHF Technical Strategy: Swissy holding near 8-month highs, but resistance has been rigid thus far.
USD/CHF has been one of the laggards on this USD-move as Franc-strength has held the up-trend back, at least by a bit. This could make short-USD/CHF attractive for USD-weakness scenarios, but USD-strength could likely be more attractive elsewhere, against another currency not CHF-related.
If you’re looking for trading ideas, check out our Trading Guides.

For the past few months, we’ve been locked-in on the range in USD/CHF. And after multiple support and resistance inflections, a quick visit down to support on the night of the U.S. Presidential Election led-in to an extended top-side move that finally broke through range resistance.

In our last article, we looked at how the rampant move in USD led to the eventual-break of range resistance in USD/CHF. But even despite this aggressive top-side break of what was previously a rigid zone of resistance, price action in the pair has lagged behind many other major-USD pairings. While Swissy is working on 8 or 9 month highs, other pairs are working on multi-year highs or lows; exhibiting the fact that while the Dollar has been strong, so has the Franc, albeit to a lesser degree.

Chart prepared by James Stanley

This can make long USD/CHF an unattractive way to look to trade USD-strength continuation; at least until something changes, and with the Swiss National Bank and a ‘really’ important ECB meeting coming up in December, you really never know. Should the Euro get slammed with weakness, we may see the SNB attempt to weaken the Franc again; but this is a distant prospect, at least from where we’re at right now.

Back to present tense: Given the fact that USD/CHF has lagged behind many other majors in showing this USD-strength, traders would likely want to relegate such a setup for USD-weakness scenarios, as there are numerous more attractive alternatives to trade with USD-strength, such as USD/JPY or even USD/CAD. So, for traders looking at Swissy right now, they’d likely want to investigate at the bearish side of the pair, but that presents complications as well, as the trader would basically be trying to fade one of the strongest USD-moves on record.

But with that said, the technical formation does exist to substantiate such a play for those looking to take on short-USD exposure. In our last article, we looked at a resistance level at 1.0176, and that’s held up incredibly well thus far. Price action has put in multiple attempts to try to break above but, at least thus far, has been thwarted on each.

The level at 1.0176 is the 50% Fibonacci retracement of the 11-year move in the pair, taking the high from the year 2005 to the low of 2011. Just a bit above at 1.0256 we have the 2016 high, and at 1.0300 we have a confluent level that’s the 61.8% retracement of the 8-year move in the pair, taking the 2008 high to that same 2011 low. This level at 1.0300 is also the 6-year high in the pair, so this could be an ideal area to investigate stop placement for short-side reversal positions.

Chart prepared by James Stanley

— Written by James Stanley, Analyst for DailyFX.com

To receive James Stanley’s analysis directly via email, please SIGN UP HERE

Contact and follow James on Twitter: @JStanleyFX

Analys från DailyFX

EURUSD Weekly Technical Analysis: New Month, More Weakness

Published

8 år ago

30 september, 2017

DailyFX

What’s inside:

EURUSD broke the ‘neckline’ of a bearish ‘head-and-shoulders’ pattern, April trend-line
Resistance in vicinity of 11825/80 likely to keep a lid on further strength
Targeting the low to mid-11600s with more selling

Confidence is essential to successful trading, see this new guide – ’Building Confidence in Trading’.

Coming into last week we pointed out the likelihood of finally seeing a resolution of the range EURUSD had been stuck in for the past few weeks, and one of the outcomes we made note of as a possibility was for the triggering of a ’head-and-shoulders’ pattern. Indeed, we saw a break of the ’neckline’ along with a drop below the April trend-line. This led to decent selling before a minor bounce took shape during the latter part of last week.

Looking ahead to next week the euro is set up for further losses as the path of least resistance has turned lower. Looking to a capper on any further strength there is resistance in the 11825-11880 area (old support becomes new resistance). As long as the euro stays below this area a downward bias will remain firmly intact.

Looking lower towards support eyes will be on the August low at 11662 and the 2016 high of 11616, of which the latter just happens to align almost precisely with the measured move target of the ‘head-and-shoulders’ pattern (determined by subtracting the height of the pattern from the neckline).

Bottom line: Shorts look set to have the upperhand as a fresh month gets underway as long as the euro remains capped by resistance. On weakness, we’ll be watching how the euro responds to a drop into support levels.

For a longer-term outlook on EURUSD, check out the just released Q4 Forecast.

EURUSD: Daily

—Written by Paul Robinson, Market Analyst

You can receive Paul’s analysis directly via email bysigning up here.

You can follow Paul on Twitter at@PaulRobinonFX.

Analys från DailyFX

Euro Bias Mixed Heading into October, Q4’17

Published

8 år ago

29 september, 2017

DailyFX

Euro Bias Mixed Heading into October, Q4'17

Why and how do we use IG Client Sentiment in trading? See our guide and real-time data.

EURUSD: Retail trader data shows 37.3% of traders are net-long with the ratio of traders short to long at 1.68 to 1. In fact, traders have remained net-short since Apr 18 when EURUSD traded near 1.07831; price has moved 9.6% higher since then. The number of traders net-long is 15.4% lower than yesterday and 16.4% higher from last week, while the number of traders net-short is 0.4% higher than yesterday and 10.5% lower from last week.

We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests EURUSD prices may continue to rise. Positioning is more net-short than yesterday but less net-short from last week. The combination of current sentiment and recent changes gives us a further mixed EURUSD trading bias.

— Written by Christopher Vecchio, CFA, Senior Currency Strategist

To contact Christopher Vecchio, e-mail cvecchio@dailyfx.com

Follow him on Twitter at @CVecchioFX

To be added to Christopher’s e-mail distribution list, please fill out this form

Analys från DailyFX

British Pound Reversal Potential Persists Heading into New Quarter

Published

8 år ago

29 september, 2017

DailyFX

British Pound Reversal Potential Persists Heading into New Quarter

Why and how do we use IG Client Sentiment in trading? See our guide and real-time data.

GBPUSD: Retail trader data shows 38.2% of traders are net-long with the ratio of traders short to long at 1.62 to 1. In fact, traders have remained net-short since Sep 05 when GBPUSD traded near 1.29615; price has moved 3.4% higher since then. The number of traders net-long is 0.1% higher than yesterday and 13.4% higher from last week, while the number of traders net-short is 10.6% lower than yesterday and 18.3% lower from last week.

We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests GBPUSD prices may continue to rise. Yet traders are less net-short than yesterday and compared with last week. Recent changes in sentiment warn that the current GBPUSD price trend may soon reverse lower despite the fact traders remain net-short.

— Written by Christopher Vecchio, CFA, Senior Currency Strategist

To contact Christopher Vecchio, e-mail cvecchio@dailyfx.com

Follow him on Twitter at @CVecchioFX

To be added to Christopher’s e-mail distribution list, please fill out this form