I’m looking at USDCHF this morning and why yesterday's strong move higher should set the tone for the coming days.
Let’s look at the 5 main reasons;
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Last week saw USDCHF bought at higher levels for a 4th week in a row
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Trading has been fluctuating around the 200 day mvg avg for 12 trading days until yesterday saw that point as a platform for strong buying
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Yesterday's initial setback found buyers at the trend defining 13 day mvg avg – a level that has held the downside throughout July
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That buying was aided by a weaker CHF with EURCHF rising by almost ¾ point.
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The market is approaching the top of an increasingly positive daily Keltner channel
I do expect overbought extremes to lead to setbacks so a little caution is called for at current levels, although such dips should prove attractive to buyers
I look to levels near .9892 to find fresh buyers. On the upside I feel the market will target June’s key .9957 top, then a projected .9996.
Only below .9833 proves this view is not right and sentiment has turned negative.
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