CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
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Swiss Franc Short-term Outlook: USD/CHF Rejected at Resistance

By :   Michael Boutros , Sr. Technical Strategist

Swiss Franc Technical Forecast: USD/CHF Short-term Trade Levels

  • USD/CHF monthly rally fails at technical resistance- reversal now poised to mark third consecutive day
  • USD/CHF support in view- bears threaten resumption of yearly downtrend
  • Resistance 7991, 8018 (key), 8060- Support 7931/45, 7872/82 (key), 7779

The US Dollar remains on the defensive early in the week with USD/CHF attempting to mark a third consecutive daily decline. A break of a multi-week uptrend now threatens resumption of the broader downtrend as the bears attempt to unwind the July advance. Battles lines drawn on the USD/CHF short-term technical charts.

Swiss Franc Price Chart – USD/CHF Daily

 

Chart Prepared by Michael Boutros, Sr. Technical Strategist; USD/CHF on TradingView

Technical Outlook: In last month’s Swiss Franc Short-term Outlook we noted that USD/CHF had rebounded off technical support and that, “From a trading standpoint, the threat remains for a larger recovery within the broader downtrend, but rallies should be limited to 8103 IF price is heading lower on this stretch with a close below 7881 needed to mark downtrend resumption.” USD/CHF rallied more than 2.4% off the monthly lows before exhausting into channel resistance last week at the 100% extension of the May decline near 8060. Price is now poised to mark a third consecutive daily decline with USD/CHF attempting to break below the July uptrend- watch today’s close.

Swiss Franc Price Chart – USD/CHF 240min

 

Chart Prepared by Michael Boutros, Sr. Technical Strategist; USD/CHF on TradingView

Notes: A closer look at Swisse price action shows USD/CHF slipping below the 38.2% retracement of the monthly range at 7991 and a break below the monthly channel threatens a larger decline while below the weekly open at 8018.

Initial support rests with the July open / 61.8% retracement at 7931/45 and is backed by the yearly low / 1.618% extension at 7872/82- losses below this threshold would threaten another bout of accelerated losses with the next technical considerations seen at the 78.6% retracement of the 2011 advance at 7779 and the highlighted trendline confluence near 7700.

Bottom line: A reversal from technical resistance is now attempting to break the July advance and threatens resumption of the broader USD/CHF downtrend. From at trading standpoint, look for a reaction into monthly open support- rallies should be limited to the weekly open IF price is heading lower on this stretch with a close below 7872 needed to fuel the next major leg of the decline. Review my latest Swiss Franc Weekly Forecast for a closer look at the longer-term USD/CHF technical trade levels.

USD/CHF Key Economic Data Releases

 

Economic Calendar - latest economic developments and upcoming event risk.

--- Written by Michael Boutros, Sr Technical Strategist

Follow Michael on X @MBForex

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