USDCHF mirroring the EURUSD

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Since the SNB has pegged the EURCHF and traders have kept the price pinned against that level, the USDCHF is more or less the inverse of the EURUSD.  The same is true from a technical perspective.  

On the daily chart the price is currently testing/moving above the high for the year (and above the high from June 1). That level comes in at 0.9770.  Staying and closing above this level would be bullish for the pair and give the longs a good feeling going into the weekend.  

Looking at the hourly chart, the price (like the EURUSD), bottomed against the 200 hour MA yesterday before surging higher. Today, after consolidating in a narrow trading range, the pair sugred higher post the US employment data.   That move has pushed the pair above the topside trend line at the 0.9772 level currently (see chart below).  This increases the importance of the 0.9770 area as a key level for the pair (intermediate traders should be encouraged by closing above).  Stay above = Bullish. Move below and the longs may look to lighten up a bit.   

 

Fianlly, the 5 minute chart outlines the trend moves in today’s trading. After consolidating for most of the Asian and London morning session, the price has trended post the US employment report. The last leg higher has taken the price above the 0.9770 June 1 high.   The 38.2%-50% of that leg higher (i.e., the “Correction Zone”) comes in at 0.9768-73).  Like the hourly and the daily, this area around the 0.9770 is key for the pair.   Move below and the last buyers at the high may look to cover before the weekend.   Stay above and longs feel no pain, shorts feel all the pain.

Overall, the pair is doing alright. 

PS.  Versus the EURUSD, the 1.2291 area is the equivalent level of the 0.9768-70 area in the USDCHF. If the EURUSD moves above the 1.2291 the USDCHF should be moving below the 0.9768 -70 area. 

15 Comments

  1. The Eur/Usd is turning the support into resistance at 1.22580 but is the Weekend Gap going to raise the fear for got short at 1.22580? thank you and happy weekend

  2. Qassam…I assume you mean 1.2285 not 1.2258? Shorts from above – whether it be from yesterday or earlier today soon after the employment – may be happy to hold shorts as long as the 1.2406 level holds or perhaps even the 100 bar MA on the 5 minute chart or 38.2% of the move down today (currently at around the 1.2329 and 1.2317 respectively). The traders who may get scared would be the new shorts who sold below the 1.2285 area. They may cover and the happy shorts may just stay on the sidelines. Next week, traders may come in an reevaluate on Monday (something about the weekend that gets traders more fearful), but so far so good for the shorts….Greg

  3. yes Sir, i meant 1.2285 :) thank you so much and happy weekend again :)

  4. Thanks Greg!

  5. Greg the 32.8% to 50.0% correction up from the last leg down, held and I got out of my longs on the counter trend move. Nice low risk trade.
    I´ve also noticed the weekly range on the weekly chart has been very decent this week. Have a good weekend and thank you.

  6. What is the next level of resistance do you anticipate if we close above the .9770 level?

  7. 0.9840-50
    0.994069 is the 61.8% of the move down from the June 1 2010 high to the low. There is not a lot to hang a hat on

  8. You traders forget that today’s selloff is a matter of dollar strength. We have broken the previous USD resistance. If we close around current highs of 83.58 or so, expect the dollar to continue rising with next stop at about 84.75 or so. Sell the EURO.

  9. Ricardo…; ) good weekend to you too and you are welcome…..Greg

  10. Thanks for weighing in Hank and putting another perspective on the move…Greg

  11. Exactly what I was thinking, Dec. 9 high of .9839, last time we had a close above the .9770 mark…

  12. Trying to decide if I should take profits before the weekend, in at .9719…

  13. Can’t really comment on your specific trade, but the good news is you would be taking a profit, beats the dilemma many face of whether to take a big loss… ; )

  14. I’ll just keep my stops right under the .9770 mark and hope no terrorist attacks on U.S. soil over the weekend…

  15. Let’s go .9770, hold up!!!

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