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I’m going to begin the day today on the US dollar versus the Swiss Frank [USDCHF]. I’m going to start all the way out here on the Weekly Chart to get a longer-term perspective for this currency pair. And taking a look at the trend pattern, on the left-hand side we can easily see that the market was in a down trend. However, over the past couple of years, going back to the beginning of 2012, we can see a completely different pattern of the trend, where we’ve seen some consolidation or ranging inside this triangle pattern I have drawn here between the bearish blue trend line at the top and the rising red trend line at the bottom.
And over the past few years, since the beginning of 2012, we’ve seen support along this red trend line here in toward the 0.9100-level and into the upper-0.9000s. So let’s take that information down to the Daily Chart. And as we get down here to the Daily Chart, we can see how the market is now finding support along that red trend line that came all the way out there from the Weekly Chart. And over the past several days – this is, again, the Daily Chart – we have found support just above that red trend line.
The yellow-shaded area represents the zone or range that we’ve been holding within as support above that red trend line. Follow that yellow-shaded area back to the left-hand side of the chart and we could see some historical reference to support back here, on the left-hand side. The end of 2012 and beginning of 2013, we found support over here and that began the rally that went all the way back up towards the top blue trend line of that triangle from the Weekly Chart.
And of course, now we’ve seen the fall all the way back down to the bottom and finding support once again into the yellow-shaded area and into that red trend line. As long as we hold above the 0.9080-level, which is the bottom of that yellow-shaded area, and the red trend line – as long as we hold above it, there’s potential for clues to reversal and a breakout as we look for a change in the trending pattern, which, right now, of course has been down, but there’s always a chance that this becomes the spot, like it did back here in the past, that we look for complete reversal and a turn back higher again.
The other side of the story, of course, is if it breaks out underneath the 0.9080-level, breaks out underneath this red trend line, we’ll likely look for it to continue to pressure lower, back towards the 0.9000-level.
Now let’s take that information down to the 4-Hour Chart. And we can see, yesterday, over the past several hours we saw a little bit of a rally above the yellow-shaded area and then a turn right back underneath it. So, we need to be confident. When does it eventually start to break out, we need to look for a change in the trending pattern. A change in the trending pattern will likely be identified as higher highs and higher lows, because right now the pattern of the trend has been lower highs and lower lows; and we can see that over the past liquid cialis several online casino free money weeks, as it’s been falling underneath this bearish blue trend line.
So, lower highs and lower lows dictating the current trend pattern. What we need to see is some major significant rise in the trend pattern and higher highs and higher lows. And I expect that will likely be a breakout above that blue trend line; will give us a better look at a change in the trend pattern. As long as it holds underneath that blue trend line, challenges and dips lower are a possibility.
Over the past few days, we have seen the bank flow levels sitting just underneath this yellow-shaded area underneath the red trend line from the Weekly Chart. We can see the bank flow – one, two, three – four days now holding just underneath that yellow-shaded area. If today’s bank flow levels come out in a similar fashion, into or just underneath that yellow-shaded area, it’ll, again, give us an expectation of support underneath there and give us an opportunity to look for buys and reversal from here. But if they start to fall and if they start to go down from the current levels, then we might look for the market to push a little bit lower.
Yesterday bank flow sell levels sit well above the market and not really a factor in the current trading decision. So, what I’m looking for today is one of two things. As long as we hold within or above the bottom of that yellow-shaded area, there’s potential low-risk – not no risk, but low risk – buying opportunities. Dips into the bottom, into the 0.9080-level or into the bank flow levels gives us an opportunity to buy and look for that reversal with fairly low risk.
If it breaks out above the blue trend line, then we also could begin looking for opportunities for this to continue that bullish pressure and a reversal for this currency pair. Now, the other side of the story, of course, is the sell side. What about the sell side? It has been going down. Well, I would expect that if we’re going to look for a sell for this currency pair, we’re going to have to look for a rally back into resistance, possibly all the way up here into this blue-shaded area, because if we look back in time, along that blue-shaded area you could see historical supports over here on the left-hand side. So, those supports will likely be our next resistance for this currency pair, and that’s closer towards the mid- to upper-0.9100s and towards that blue trend line.
So, the closer we get to the blue trend line, the blue-shaded area becomes potential resistance and a selling opportunity. The other side of that would be a breakdown of that yellow-shaded area. If we finally get down underneath it, open and close, likely on the Daily Chart, underneath the 0.9080-level and that red trend line, we’re likely looking for a continuation lower. So, two things. If you’re looking for a sell, a rally into resistance becomes a selling opportunity. Blue zone, green zone, purple zone – those become sells into resistance in the direction of our current trending pattern, or a break underneath 0.9080 and the bottom of that yellow-shaded area to continue the bearish price action.
Otherwise, we’re looking for lower risk buying opportunities and reversal indicators towards the 0.9080-level. The bottom of the yellow zone becomes a fairly low risk opportunity. Look for that reversal or the break of the blue trend line becomes that chance to look for reversal of the current trending pattern and possibly a challenge back into the bank flow sell levels that sit up here all the way into the upper-0.9200s for the USDCHF today.
