Scenario
Timeframe - Intraday
Recommendation - BUY STOP
Entry Point- 0.9590
Take Profit - 0.9685, 0.9719, 0.9734, 0.9761
Stop Loss - 0.9525
Key Levels - 0.9442, 0.9474, 0.9500, 0.9549, 0.9570, 0.9646, 0.9685, 0.9734, 0.9761, 0.9800, 0.9900, 0.9921, 0.9971, 1.0000
Alternative scenario
Recommendation - SELL STOP
Entry Point - 0.9560
Take Profit - 0.9500, 0.9442
Stop Loss - 0.9600
Key Levels - 0.9442, 0.9474, 0.9500, 0.9549, 0.9570, 0.9646, 0.9685, 0.9734, 0.9761, 0.9800, 0.9900, 0.9921, 0.9971, 1.0000
Current trend
The Franc showed a strong growth against the US Dollar on Wednesday, and the USD/CHF pair fell to new local lows.
Besides the forthcoming referendum in the UK, the American currency was under pressure from very cautious position of Fed Chair regarding future interest rate increases. Janet Yellen paid particular attention to global economic instability and risks linked to Britain’s possible exit from the EU.
The Swiss currency, in its turn, gained support when the Centre for European Economic Research (ZEW) released data on Switzerland’s Economic Expectations. The index was up by 1.9 points and came out at 19.4 points, which is the highest level since February 2014.
Support and resistance
Bollinger Bands on the daily chart is directed down while the price range is narrowing actively. MACD is gradually falling and keeping a sell signal. Stochastic is moving slowly towards the border of the oversold zone.
The indicators recommend waiting for clearer trading signals.
Support levels: 0.9570 (16 June low), 0.9549 (22 June low), 0.9525, 0.9500 (beginning of May level), 0.9474, 0.9442 (3 may level).
Resistance levels: 0.9615, 0.9646, 0.9685 (16 June high), 0.9719, 0.9734, 0.9761 (6 June high), 0.9800, 0.9842, 0.9860, 0.9900, 0.9921 (3 June high), 0.9954. 0.9971, 1.0000 (strong psychological level).
Trading tips
Long positions can be opened after the price rebounds from current levels, e.g. 0.9570, (with appropriate indicators signals) with targets at 0.9685, 0.9719, 0.9734, 0.9761 and stop-loss at 0.9525. Validity – 2-3 days.
Short positions can be opened after the price breaks down the level of 0.9570 with targets at 0.9500, 0.9442 and stop-loss at 0.9600. Validity – 2-3 days.