Yesterday’s signals produced a profitable short trade entry from the bearish doji candlestick which rejected the resistance level at 1.0058. It might be wise to fully exit the trade now.

Today’s USD/CHF Signals

Risk 0.75%.

Trades must be entered before 5pm London time today only.

Short Trades

  • Go short following a bearish price action reversal upon the next touch of 1.0025 or 1.0058.

  • Put the stop loss 1 pip above the local swing high.

  • Move the stop loss to break even once the trade is 20 pips in profit.

  • Remove 50% of the position as profit when the price reaches 20 pips in profit and leave the remainder of the position to run.

Long Trade

  • Go long following a bullish price action reversal upon the next touch of 0.9986.

  • Put the stop loss 1 pip below the local swing low.

  • Move the stop loss to break even once the trade is 20 pips in profit.

  • Remove 50% of the position as profit when the price reaches 20 pips in profit and leave the remainder of the position to run.

The best method to identify a classic “price action reversal” is for an hourly candle to close, such as a pin bar, a doji, an outside or even just an engulfing candle with a higher close. You can exploit these levels or zones by watching the price action that occurs at the given levels.

USD/CHF Analysis

I wrote yesterday that key levels looked like holding and the price seemed to be going nowhere, although there was a hint of the beginning of a more bearish trend so a short trade from a firm rejection of the resistance at 1.0058 could be an interesting opportunity especially if it happens early in the London session – I would take a bearish bias if that sets up. This was a good call as the trade did set up, although later in the day than I had hoped for and was profitable.

The picture is now more bearish as the USD weakens and the former support at 1.0028 flips to become new lower resistance. It is also more obvious that the price movement is contained by a bearish price channel which is shown in the chart below. I would take a bearish bias today if we have a strong bearish rejection of the resistance at 1.0025.

USDCHF

There is nothing of high importance due today regarding the CHF. Concerning the USD, there will be a release of FOMC Meeting Minutes at 7pm London time.

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