Talking Points
USDCHF focus shifts higher after rebounding off support/weekly opening range breach
Scalp bias bullish above the 90-figure,
Broader outlook constructive above 8935- bullish invalidation
USDCHF Daily Chart
Chart Created Using FXCM Marketscope 2.0
Broader Technical Outlook
USDCHF Breaks weekly ORH after rebounding off the 61.8% retracement
Note RSI support hold above 40 & 50 breach – bullish
Interim resistance 9041/59- Breach targets objectives at 9107/22 & 9188/98
Scalp bias bullish above 90-handle / Broader bias constructive above 8935
Event Risk: US Personal Income/Spending & University of Michigan Confidence Tomorrow
USDCHF Scalp Chart
Notes: The USDCHF has made an impressive rebound off Fibonacci support after defending the January opening range low on Friday. Although the pair invalidated our setup last week with a break below 9080, a topside breach of this week’s opening range high warrants long exposure and our immediate focus remains weighted to the topside while above the 90-handle.
That said, the pair has now come up against interim resistance at 9040/58 which is defined by the 100% extension taken form the advance off last week’s low, the 100-day moving average, trendline resistance and the 61.8% retracement of the decline off the monthly high. A breach above this threshold offers further conviction on our directional bias with such a scenario eyeing subsequent topside resistance targets.
Bottom line: We’ll look to buys dips/breaks of resistance while above 90 with only a break below last week’s close low at 8935 (also the 61.8% retracement) invalidating the our broader outlook and targeting the key support zone between 8860/88. Note that the daily momentum signature made a clean rebound off the 40-threhsold, suggesting that the recent decline off the monthly highs remains corrective in nature. Follow the progress of this trade setup and more throughout the trading week in DailyFX on Demand.
* It’s extremely important to give added consideration regarding the timing of intra-day scalps with the opening ranges on a session & hourly basis offering further clarity on intra-day biases.
Key Threshold Grid
Entry/Exit Targets
Timeframe
Level
Significance
Bearish Invalidation
Daily / 30min
9041/59
100% Ext / 61.8% Retrace / 100DMA
Break Target 1
Daily / 30min
9077/83
61.8% Retracement / Last Week’s ORL
Break Target 2
Daily / 30min
9107
1.618% Fibonacci Ext
Break Target 3
30min
9130
Soft Resistance / Pivot
Break Target 4
30min
9153
78.6% Retracement
Break Target 5
Daily / 30min
9188/98
38.2% & 88.6% Retrace / 11/20 Weekly High
Break Target 6
Daily
9222
200DMA
Break Target 7
Daily
9259
100% Fibonacci Extension
Bullish Invalidation
30min
8998- 9009
Weekly ORH / 61.8% Ext / 38.2% Retrace
Break Target 1
30min
8962
23.6% Retracement
Break Target 2
Daily / 30min
8935
61.8% Ext / Wkly ORL / Last Wk’s Close Low
Break Target 3
30min
8902
Monthly ORL / Last Week’s Low
Break Target 4
Daily / 30min
8875/88
100% & 78.6% Exts / October Low
Average True Range
Daily (20)
72
Profit Targets 17-19pips
*ORH: Opening Range High
*ORL: Opening Range Low
Other Setups in Play:
FOMC Setups – EUR, CAD, Gold Eye Key Dollar Inflection Points
CADJPY Scalps Favor Selling Rallies Post Key Support Break
USDCHF Scalp Setup Eyes Channel Support- Bullish Above 9080
EURUSD Bias At Risk Above 1.3522- Weekly Opening Range in Focus
—Written by Michael Boutros, Currency Strategist with DailyFX
For updates on this scalp and more setups follow him on Twitter @MBForex
To contact Michael email mboutros@dailyfx.com or Click Here to be added to his email distribution list
Join Michael for a Live Scalping Webinar next week on Monday, Tuesday and Wednesday mornings on DailyFX Plus (Exclusive of Live Clients) at 12:30 GMT (8:30ET)
Interested in learning about Fibonacci? Watch this Video
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.Learn forex trading with a free practice account and trading charts from FXCM.
Source: Daily fx
