Yesterday’s signals were not triggered as there was no bearish price action at 1.0110.

Today’s USD/CHF Signals

Risk 0.75%.

Trades may only be taken before 5pm London time today.

Short Trades

  • Short entry following a bearish price action reversal upon the next touch of 1.0150 or 1.0191 or 1.0207.

  • 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 Trades

  • Long entry following a bullish price action reversal upon the next touch of 1.0097 or 1.0058 or 1.0025.

  • 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 break below 1.0058 would be a bearish sign so that was quite likely to be the day’s pivotal level. This was a good call as the level was never even reached and the price has continued to rise to approach long-term high prices, invalidating resistance levels along the way.

This pair is usually extremely mean-reverting, which suggests that as we are at an area of long-term resistance at a price extreme, short trades are going to become interesting if you have the patience to hold tight while the price takes its time moving down. However, if the price breaks above 1.0125 on strong volatility, it is likely to reach 1.0150, and a break above that level would be a very bullish sign. I think if the price can trade above 1.0125 for two hours as New York opens or before, we will see yet higher prices – however, beware of the U.S. and U.K. data events which could produce strong and surprising movement in either direction.

usdchf

There is nothing of high importance due today concerning the CHF. Regarding the USD, there will be a release of CPI data at 1:30pm London time.

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