Dukascopy Bank Team
Dukascopy Bank SA
USD/CHF 4H Chart: Channel Up
Comment: USD/CHF has recently tested water above this year’s maximum, and the next prominent high is as far as 1.1730, represented by the highest level since 2010. In the short run, we expect the price to rebound from the weekly PP at 1.0260 and test the upper trend-line of the channel at 1.0450. The bullish outlook is reinforced by the daily and weekly indicators. Also, the US Dollar is oversold, as 72% of open positions are short, meaning demand is highly likely to increase. In case the rate drops beneath the support trend-line at 1.0230, the first target will be the monthly PP and Nov 24 low at 1.0150, while a combination of the monthly S1, Nov 12 low and 200-period SMA will become the main objective.
USD/CAD 4H Chart: Rising Wedge
Comment: The risks are heavily skewed to the downside for USD/CAD. First, the price is approaching a tough resistance level represented by the September high. Secondly, the pair is forming a rising wedge, a pattern that is often followed by a sell-off. The point against such a scenario is the SWFX sentiment, being that the bears already take up 60% of the market, and it will be difficult for them to increase this percentage. Still, the base scenario is a dip through the up-trend at 1.3340. The initial target will then be the weekly S1 and monthly PP at 1.3290/80, while an additional strong demand area is near 1.3210, created by the weekly S2 and long-term moving average.
This overview can be used only for informational purposes. Dukascopy SA is not responsible for any losses arising from any investment based on any recommendation, forecast or other information herein contained.
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