USD/CHF Price Analysis: Bulls waiting to charge in a daily continuation from key support

  • USD/CHF has stalled the monthly decline in demand territory.
  • Bulls will be looking for a sizeable correction and opportunity on the lower time frames. 

The Swiss franc's net positioning has been reduced from an institutional perspective over the last couple of weeks with both longs and short positioning being trimmed. 

However, the US dollar has been correcting also which has tipped the balance in favour of the upside. 

The following is a top-down analysis where a bullish bias has been derived overall. 

Monthly chart

Bulls stepping in on the monthly chart at a demand area opens opportunity ton the lower time frames to target prior structure, aka, new resistance. 

At least a 38.2% Fibonacci retracement would be expected which has a confluence with the prior lows, aka, new resistance. 

Weekly chart

The weekly chart shows a bullish doji and overhead resistance.

There is also the current candlestick's wick that would be expected to be filled in. This represents a pull-back on the daily chart and prospects of a bullish continuation. 

Daily chart

Following the doji and the bullish engulfing candlestick, the price rallied.

It has since corrected to the W-formation's neckline and for a 38.2% Fibonacci retracement of the bullish impulse. 

An upside continuation would be expected from this area of support.

4-hour chart

As illustrated, a probable scenario from here would be for the creation of a W-formation on the 4-hour chart. 

The potential bullish impulse, completing the W-formation, would be expected to retrace at least to a 38.2% Fibonacci level.

There is the confluence with the neckline of the W-formation at that area also.

An upside extension would then be probable towards the weekly resistance area and thus completing a bullish daily extension. 

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.

Feed news

Latest Forex News

Latest Forex News

Editors’ Picks

EUR/USD hits fresh one-month low amid souring market mood

EUR/USD has been extending its falls and dips below 1.21 as US retail sales badly disappointed and the worsening mood is supporting the safe-haven dollar. Markets digest Biden's stimulus plan. US Consumer Sentiment declined to 59.2 points. 


GBP/USD retreats toward 1.36 amid fresh dollar strength

GBP/US has pared its gains and falls toward 1.36 as the dollar gains ground. The UK economy shrank by 2.6% in November, better than estimated. The UK is ramping up its vaccination campaign and PM Johnson is pressured to ease the lockdown. 


Gold extends sideways grind near $1,850

The XAU/USD pair registered small daily gains on Thursday but struggled to extend its recovery amid a lack of significant fundamental drivers on Friday. As of writing, the pair was up 0.15% on a daily basis at $1,849.

Gold news

Forex Today: Markets “sell the fact” on Biden's stimulus, dollar rises, retail sales eyed

Markets are on the back foot after Biden hinted about tax hikes while introducing stimulus. The safe-haven dollar is edging higher despite Powell's pledge to keep monetary policy accommodative. 

Read more

DXY breaks above key downtrend, eyes move above 91.00

USD has been strongly supported on what has shaped up to be a very much risk off final trading day of the week. Most G10/USD pairs have seen significant weakness, aside from CHF/USD and JPY/USD, given that the two currencies are also considered “safe havens”.

US Dollar Index News