Chart of the Day
USD/CHF Daily Chart — September 10, 2009
By
James Chen
, Published:
9/10/2009
(Price on 1st pane, Slow Stochastics on 2nd pane; horizontal support/resistance levels in yellow; uptrend lines in green; downtrend lines in red; chart patterns in white; 50-period simple moving average in light blue.)
9/10/2009 – USD/CHF – Price action on USD/CHF, a daily chart of which is shown, has finally broken the sideways consolidation that has characterized the pair all the way since early June. The dollar drop that commenced right after the U.S. Labor Day this week, which was also reflected in the other major dollar-based currency pairs, has reached strong support in the 1.0370 price region. This occurs after price broke down below the consolidation support in the 1.0550 price region, as well as a small triangle-type consolidation pattern. Today, in the process of dropping slightly below the 1.0370 support level, a new 2009 (and 13-month) low for the pair was established. This 1.0370 level represents the low reached on the bearish spike that occurred a couple of days before New Year’s. Although the dollar may now be taking a breather after the marked bearishness of this week, any strong subsequent breakdown below the noted 1.0370 support level could potentially lead the pair down to target parity at the important support/resistance and psychological price level of 1.0000. Parity was last approached in July of 2008. Upside resistance within the context of the current continuing downtrend resides around the just-broken 1.0550 price region.
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James Chen, CMT
Chief Technical Strategist,
FX Solutions
Chief Technical Strategist,
FX Solutions
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