The USDCHF rebounded earlier this week in the process extended above the 38.2% retracement of the move down from the May high to the June low. The level came in at 0.8986. However, momentum cannot be sustained in the price started rotation to the downside helped by the weaker CPI on Wednesday.
The low for the week extended below its 200 day moving average of 0.88968. Last week that moving average was also broken but each break failed. The one on Wednesday also failed.
After rebounding on Wednesday into the close and trading higher on Thursday into the New York session, sellers returned pushing the price down to a floor near 0.89318. That floor was ultimately broken today. The current price trades near 0.8909.
So sellers are more control. The price is below a cluster moving averages including the:
- 200 hour moving average 0.8939
- 100-day moving average 0.89535
- 100-hour moving average also at 0.89535
All those levels would need to be broken on the top side to shift the bias back in the buyers favor at least in the short term. Absent that, and the 200 day moving average at 0.88968 is the key focus for sellers. Get and stay below that level, opens the door for more selling.
This article was written by Greg Michalowski at www.forexlive.com.
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