Transcript of Video
From Forex Traders Daily, this is your daily analysis with Ross Mullins, live from Richmond, Virginia.
Hello everyone, this is today’s video analysis for March 14, 2018. Today we’re going to take a look at the US Dollar versus the Swiss Franc [USDCHF] for today’s trade analysis.
It’s important for me to remind you that in about 40 minutes from the recording of this video, we have some news popping up out of the US. Retail sales and PPI information could affect the direction the market is going in the rest of the day, so you’ll want to make note of that. It could change the analysis that we’re looking at here, or maybe not.
Anyway. We’re looking at two different trends here. The blue trend line clearly a downtrend. In recent weeks, we have seen a rising trend here for the USDCHF as it has been climbing from down here towards the 0.9200-level. Now into the 0.9400s. There’s been a pattern within this trend along the black trend line that I want to point out. Let’s go ahead and zoom it in another time.
There’s a pattern within the trend, where it took the rise from the lowest low and then went into a little period of congestion right here in the middle, where this little short black trend line is. Came back down to the yellow zone and then eventually broke out and went higher. It did it again here, where the market made a little bit of a retracement and then broke out and went higher.
So, within that pattern of the trend, where we see congestion, support, breakout, congestion, support, breakout, we are seeing that next iteration of the trend as it’s come down now from the green zone, 0.9515, down toward 0.9435, the purple-shaded area. Now sitting here. If the pattern of the trend continues, this may be the support that we need to see for it to turn around and go back higher and maybe make a new high all the way back up here towards the pink zone. That would be the repetition of the pattern.
Green zone of course is our first area of resistance. So, the purple zone is what we’re looking at. We have the black trend line there. We have the historical supports, or support here at 0.9435, where resistance is back here. We could see clearly that historically, I’m just going to draw out a little circle here. We see resistance right here, but not just there. Draw out another little circle here. We see resistance here.
So, both places where the black circles are show us resistance. We’re now into that same area as support, 0.9435, 0.9460. That’s that same area that we’re looking at right now. So, as long as it’s above there, there’s this potential that it finds support and goes back up. If the US news is positive and exceeds the forecast, then we look for it to go back towards the green zone as our resistance or higher if it continues the pattern, which is congestion, support, breakout.
The risk here is that the market changes. It gets under the black trend line, under 0.9435, and goes back in the other direction, so the risk is fairly minimal. So, what are we waiting on? Well, I think we need to see some evidence that buyers are going to step back in and drive it back up. Yeah, we have a little blue candle here, but we have that news popping up here shortly, so we want to be sure that the buyers are going to come back in.
Let’s go back and study this area right here, and I’m just going to go back to right here, where the orange-shaded area is. We see several days sitting here, where that orange-shaded area is. Four days.
Let’s go down to the four-hour timeframe and look at that period inside that orange zone, where the market bounced around in there. And there it is right here inside this circle, where the market bounced around in here for several days, four days, and eventually turned back. You could see multiple times where there was an infusion of buy orders and settled down. Infusion of buy orders. Got above. Settled back down. Infusion of buy orders.
So, what we see here is four times that the buyers are fighting back against the sellers and eventually they won the battle. Well, we’ve just now seen our first indication that buyers are fighting back against the sellers. Just like here, four times from the orange zone, fighting back. We see our first time. So, what I’m looking for is further indication of buying pressure. Maybe some positive news out of the US today.
Getting back above. Just like it did over here, back above the purple-shaded area will increase our confidence that we’re looking for it at least to go back up here to the green zone, if not higher. The risk here of course is that it breaks down under the purple zone. A breakout under the purple zone, 0.9435, may lead it back down to the orange zone. So, our risk here is that it gets underneath.
So, what we need to see is some clear evidence buyers are staying in control, driving it back above 0.9460 to head higher, or sellers take control. Drive it back underneath 0.9435 to send it back lower again for the USDCHF.
Forex Traders Daily, this has been your daily analysis with Ross. If you would like to get Ross’ analysis on all the currency pairs he’s watching and all the trades he takes today, join him in his live Trade Room by clicking on the link below. Please leave any comments you have about today’s video in the comment section below.