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| USD/CHF Short from Downward sloping Trend Line Posted: 20 Dec 2010 01:01 AM PST
The USD/CHF has broken out of a previous rising channel line and then retraced back to the lower line. For traders who missed the previous entry opportunity, a new setup has emerged as the pair is moving lower from the current trend line. After the pair reached an all-time low in October a bullish channel emerged with the USD/CHF rising to a high of 1.0065 in early December. Since then the downtrend has once again established itself as the moving averages are now trading in a perfect order. A perfect order occurs when the moving averages appear according to their time frame; the 200-day simple moving average above the 100, followed by the 50, 20, and 10 (not shown). Also signaling the downtrend is the trend line beginning on December 1st with a contact point in mid-December. An ADX of 31 also identifies a strong trending environment. Today's price action shows the pair falling from two key points which provide resistance for the pair; the falling trend line and the 10-day exponential moving average. Traders may find an entry point short near this level which comes in today at 0.9715. Stops can be placed above the resistance level of .09730 Additional resistance may be found at 0.9850. A target for this trade may be found at Friday's low of 0.9560.
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| USD/CHF – Downtrend Looks to Continue Posted: 22 Sep 2010 03:26 AM PDT
The Swiss franc continues to rally against the dollar as the pair moved past parity and today has taken out the 2009 low in a sustained downtrend that shows further signs of continuing. The swissie has been rallying, taking out multiple support levels on its way below the 1.0000 level. Signs of a trending market appear which may make for entry good opportunities on pullbacks in the price. Using multiple moving averages, a trader can identify the USD/CHF is in a sharp downtrend. The 200-day, 100-day, 50-day, 20-day, and 10-day simple moving averages are in a perfect order, appearing from top to bottom in this order. This is one indication of a trending market. Another sign of the trending environment is the ADX indicator which reads 33. Anything above an output of 25 indicates a currency pair that is in a strong trend. The moving averages and the ADX indicator are not shown on the chart below. Now that the trending environment has been identified, entry opportunities can be found on pullbacks to known resistance levels for the USD/CHF. Resistance is found at 1.0060, the low from September 1st. Resistance can also be located at 1.0000. This is a big round number and traders have a tendency to flock to big round numbers. The support at 0.9915, the 2009 low was taken out today and will now act as a resistance level. Short term price targets can be found by drawing a parallel channel line below the price action for the current downtrend. Today traders can look for the 0.9870 to come into play.
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