The USDCHF is more or less being confined by 2 moving averages.
Looking at the hourly chart, the falling 100 hour moving average above currently comes in at 0.9645. The price has tested that moving average on 2 separate days over the last week of trading. Last Wednesday, the high price stalled against the level and again yesterday, the high price also stalled against the level. Stay below the 100 hour moving average is more bearish.
Having said that, on the downside the 100 day moving average at 0.9610 is doing a pretty good job of setting a floor. Admittedly, the price traded below that moving average level on a number of hourly bars in the London morning session mainly with a low price at 0.9604. However, momentum to the downside could not be sustained on all the little breaks seen today. In other words traders are reluctant to push much below that key moving average.
So are traders waiting for the shove from the FOMC rate decision?
It seems that way...
- The trading range for the week is a very modest 65 pips
- the falling 100 hour moving average has put a ceiling on the rallies
- the 100 day moving average has acted as a decent floor
On a move above the 100 hour moving average, traders will look toward the high for the week at 0.9669 followed by the falling 200 hour moving average at 0.9689. That level is also the 50% midpoint of the range since the June 29 low. Get above 0.96898, and it opens the door for further upside momentum with 0.9723 to 0.97359 as the next area to get to and through (see swing area).
On the downside, break below the 0.9600 level and the swing low from July 5 with momentum, would have traders targeting the swing low from July 4 at 0.9559 followed by the swing low from June 30 and June 28 near 0.9532. The low price from June reached 0.94945. The low was the lowest low going back to April 21.
