Falls away from 100 hour MA
The USDCHF fell yesterday and toward the end of the day, cracked below its 100 hour MA (blue line). The pair also started to dip below a swing area between 0.92448 and 0.92496. The price stayed below that area in the Asian session and accelerated the move lower in the early European session.
The pair has now moved to a new low for the day and is testing a cluster of support defined by the 38.2% at 0.9202, the natural support at 0.9201 and the rising 200 hour MA at 0.91941. The area (between 0.9194 and 0.9202) will now need to be broken to solicit more selling momentum with 0.9184-88 as the next target on a break. The low just reached 091928 - just below the low 0.91941 200 hour MA. The price is bouncing modestly.
What now?
Buyers seemed to have leaned against the 200 hour MA on the first look. That is normal. The price has not been below the 200 hour MA since September 21.
However, I would suspect that if broken, we should see further downside momentum with the 0.9184 level as the next target followed by the 50% retracement at 0.91731.
If the support buyers hold the level and the price can trade more comfortably above the 0.9202 level, it may attract more buying/covering. The next upside target would look toward the 0.92149 to 0.92216 area (see red numbered circles in the chart above).
