- USD / CHF gains strong positive traction on Monday and recovers further from multi-year lows.
- The bulls could now expect a sustained move above stiff resistance near the 0.8915-20 region.
The USD / CHF pair has gained strong positive traction on the first day of a new week and has built on last week’s rebound from multi-year lows. Momentum has extended during the European session and has pushed the pair past the round level of 0.8900, into two-week highs.
The pair has now approached the 0.8915-20 resistance zone, which coincides with the upper bound of an upward sloping channel. A convincing breakout will be seen as a new trigger for the bulls and will pave the way for a further short-term upward move amid widespread USD strength.
Meanwhile, the technical indicators on the daily chart have started to move into bullish territory and add credibility to the constructive outlook. That said, the oscillators on the 1 hour chart are about to move into overbought territory and warrant some caution for the bulls.
Therefore, it will be prudent to wait for a strong continuation buy beyond the strong 0.8915-20 barrier before opening new bullish positions. The subsequent positive move has the potential to push the USD / CHF pair towards a recovery from the key psychological level of 0.9000.
On the other hand, any significant decline could now find decent support near the 0.8875 level. Any subsequent decline is likely to find support in the trend channel, around 0.8850. This last level also marks the 50 hourly SMA and should act as a fundamental point for short-term investors.
USD / CHF 1 hour chart
USD / CHF technical levels
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