The USDCHF moved down on Friday and once again moved closer to the low of the up and down swing area that has confined most of the trading going back to around August 20. The low for that swing area comes in near 0.8400, and on Friday and again today, that area was tested and ultimately found support. The sellers turned to buyers and have since pushed the price back toward a cluster of moving averages.
Those moving averages include:
100 hour moving average at 0.84548200 hour moving average of 0.84664.100 bar moving average on the four hour chart at 0.8469
All those moving averages come near the middle of what is the high of the trading range going back to August 20. I have that up and down area (Red Box on the chart below) capped at 0.85368
What next?
If the buyers are to feel even more confident, getting above those moving averages would tilt the bias in the bullish direction.
Having said that just looking at the chart below, the price action has been up and down so traders need to be aware of a shift back to the downside at any time. It could easily come against the MAs above.
Another level of importance to the upside is the 38.2% retracement of the range since the mid-August high at 0.85172. The high price from last week also stalled near the falling 200-bar moving average on a 4-hour chart. That level is now at 0.8498. Those levels were all below the “red box” high target.
So there has been more of a negative bias from that perspective.
This article was written by Greg Michalowski at www.forexlive.com.
