Cabana Capitals Blog forex trading USD/CHF: The pair falling towards the lower lows in this session

USD/CHF: The pair falling towards the lower lows in this session

USD/CHF: The pair falling towards the lower lows in this session post thumbnail image

General overview: The USD/CHF pair witnessed some aggressive selling during the early European session and dropped to fresh multi-year lows, around the 0.8825 regions in the last hour. Following a brief consolidation through the first half of the trading action on Wednesday, the pair met with some fresh supply and edged lower for the third consecutive session. The downfall was exclusively sponsored by the prevalent bearish sentiment surrounding the US dollar.  fact, the USD Index tumbled to fresh two-and-half-year lows amid firming expectations for additional US fiscal stimulus measures.

Apart from this, a fresh leg down in the US Treasury bond yields further undermined the greenback and contributed to the USD/CHF pair’s ongoing decline. The USD selling picked up pace amid a sudden pickup in the shared currency following the release of better-than-expected German PMI prints for December. This comes on the back of hopes for a Brexit deal, which continued lending some support to the sterling and added to the USD selling bias. So, for the time while we can say the market will fall downward. USD/CHF remained depressed for the third consecutive session on Wednesday. Sustained USD selling bias was seen as a key factor exerting pressure on the pair. The risk-on mood did little to lend any support as the focus now shifts to FOMC.

Technical Analysis: From the technical perspective we can say that market will fall towards the downside in the market. Weighing on CHF on Wednesday was the release of the US Currency Manipulation Report and the fact that Switzerland was designated as a currency manipulator. We can see the market the will touch the lowest low this time.  On the daily chart, we can see price will fall towards the lower side this side and making the lower lows. the market will be making the move towards the south side. The major EMA lines will fall below SMA lines.

The price pattern will move towards the lower side and the indicator will fall towards the lower side and MACD will be fall towards the lower sides and favouring the lower momentum this side. On the 4 hourly chart we can also see market favouring the lower side and favouring the trend in the market. Odds are in favour of the market. The pair is hitting the monthly low this time. the pair is creating the lows on the basis of negative volatility in the market. The sessions create the lower volume in the market and the market will force to move downwards in this trading sessions. The current status of the market is 0.8841 and the support will be 0.8775 followed by 0.8709 and resistance is 0.8901 followed by 0.8973.

Trade idea: we can conclude that the seller will go for sell at 0.8843 targets will be 0.8723 -0.8650 and stop loss will be 0.8950.

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