Technical Outlook- Important CHF Pairs

Reversing its last weekend decline, triggered by fourth negative CPI reading in previous five, the Swiss Franc (CHF) extended its across the board gains during the current week. The CHF trades near a week’s low against its US and Japanese counterparts and is on the fourth consecutive decline road against EUR while the aftershocks of UK election results, coupled with positive labor market details, helped GBP to witness minor damages against CHF. With the Swiss market observing Ascension Day holiday, market players could wait for monthly reading of the Swiss PPI, scheduled for announce on Friday, in order to determine near-term CHF moves.

Also Read: Global Economic Releases To Drive The Forex Market

With the Swiss currency riding on success path, major CHF pairs, namely USDCHF, EURCHF, GBPCHF and CHFJPY, are observing descending trend-channel formation on their daily chart. Following is a brief technical overview relating to mentioned pairs.

USDCHF

On Wednesday, USDCHF registered successful effort to break its 0.9165-60 horizontal support; though, the descending trend-channel support, near 0.8980, together with oversold RSI, could become a reason for the pair traders to trim their shorts. However, on a failure to rest near 0.8980, the pair could drift lower towards testing 76.4% Fibonacci Retracement of its post-SNB up-move, near 0.8880, breaking which 0.8750 is likely intermediate support for the pair before it could target year’s low near 0.8500 psychological mark. On the upside, the 0.9165 horizontal mark becomes immediate resistance for the pair, breaking which multiple resistances near 0.9230, quickly followed by the 50% Fibo, near 0.9300 mark, and the 0.9380 are likely consecutive resistances for the pair before it could test the 0.9460 channel resistance. On the sustained trading above 0.9460, the 200-day SMA and the 38.2% FIob, near 0.9500 psychological mark could become strong resistance for the pair traders to observe.

Also Read: Technical Update - EURUSD, GBPUSD, AUDUSD and NZDUSD

EURCHF

Alike its US pair, the EURCHF also follows the descending trend-channel; however, recent flow of better EU numbers restricted the pair’s decline with the channel resistance and 50-day SMA, near 1.0450-60 region restricting pair’s near-term advance while 1.0340 and the 50% Fibonacci Retracement of its late-January – February up-move, near 1.0300, providing immediate support to the pair. Pair’s decline below 1.0300 could find 1.0230, 1.0160 and the 1.0130 channel support. However, a break of 1.0130 could make the pair vulnerable to plunge towards testing parity level 1.0000. On the upside, a break of 1.0460 can be followed by 1.0510-20 resistance region before the pair could test 1.0570, marked by 23.6% Fibo. With the pair’s ability to sustain a break above 1.0570, it could rally to 1.0670 prior to targeting 1.0750 and the year high near 1.0800 mark.

Also Read: Technical Outlook – EURAUD, EURJPY and EURGBP

GBPCHF

Failure to break the channel resistance, currently near 1.4590, pulled back the GBPCHF towards testing 1.4350-40 multiple support region, breaking which 1.4300 mark, including 38.2% Fibo of its Jan – Feb up-move, the 1.4180 and the 50% Fibo, near 1.4100 mark could restrict the pair’s immediate decline before it could test 1.3840 channel support. On an extended decline below channel support, the pair could target 1.3320 on the downside while 1.3630 being intermediate support. Alternatively, a break above 1.4590, also surpassing the 23.6% Fibo, near 1.4630, could fuel the pair’s rally towards 1.4770 and the 1.4970 resistances before it could break 1.5100 region.

CHFJPY

Having failed to break 131.30-40 region, encompassing 61.8% Fibo of its late January – February decline, during last week’s rally, the CHFJPY again trades near the said resistance region, breaking which it could paddle its northward journey towards 132.20 and the 133.80 – 134 region. Ability on the part of the pair to surpass 134 region could magnify its strength to target 137 region. On the downside, 130 psychological mark, the 50% Fibo, near 129 and the 128, followed by 127.60, are likely consecutive supports for the pair. A sustained break of 127.60 could witness 126.80 and 125.70 before testing the ascending trend-line, also encompassing 50-day SMA, near 124.80-75 region.

 

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Anil Panchal
Market Analyst
Admiral Markets

At any use of the analytical material taken from the site of company Admiral Markets, and the secondary publication on any other resources, the rights to intellectual property for a dealing center «Admiral Markets», the reference to the company site is obligatory.

 

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