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Technical Analysis: USD/CHF Channel Formation at 1.0140 Resistance

Posted by Chris Advincula on Feb 28, 2017 6:37:16 AM


(Feb 28 Tuesday) The USD/CHF 8 hour chart shows a resilient rebound of the dollar against the swiss franc from 0.9860 low (Dec 30) to the recent and first resistance high of 1.0140 (Feb 21), where dollar buying interest came after testing close to the 0.9860 Fibonacci (61.80%) retracement and support.

There is a rising channel formation on the chart with the 14 DMA support line at 0.9900 (Dec 31) moving higher to 1.0110 (Jan 22). Looking at the 30 DMA on the other hand, see how it fell from 1.0260 (Dec 26) to 0.9945 (Feb 6) after the rate fell, more on year-end swiss buying than dollar selling.

The Fibo 0.9860 (61.80%) level shows more of a dollar buying trend with speculation building of a next Fed interest rate hike in either March or April and as the Trump economic reform optimism continues.

If the upward trend continues, watch the 1.0140 resistance, where if broken the next price objective could be 1.0210 and the second resistance is 1.0250. The 14 day RSI (relative strength index) chart below shows the 30 oversold level has been tried. We appear to have more room on the RSI before it reaches the reversal point at the 70 overbought level. 

Consolidation between 1.0140 and the Fibo 0.9945 (50.00%) may happen first before breaking 1.0140.

Topics: USDCHF, Swiss franc, US Dollar, technical analysis, Forex


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