USD/CHF (a 4 hour chart)
February 4, the pair dollar / franc continues to develop a sell signal, still we see that the pair started an upward correction and may work out the pivot level 0.9130 today. The current sell signal is confirmed and strong as the Chinkou Span is below the price chart and the price is below the Ichimoku cloud.
So now the goal for the downward movement is the first support level which is 0.8968. If the price consolidates below the first target a new target for the downward movement will be available. The new target is the second support level – 0.8859.
The downward movement will stay as long as the price is below the Kijun-sen (0.9145), if the price consolidates above this line the sell signal will be weakened and will be put on the brink of cancellation. Should that happen an upward movement will start growing up to the upper boundary of Ichimoku cloud.
The Chinkou Span is below the price chart that is a confirmation of the current sell signal, indicating a bearish mood of traders.
Bollinger Bands shows a continuous downward movement, the bands are narrowing and heading slightly downwards. We suppose that short positions are more relevant now.
MACD is turned up that indicates an upward movement. Should the indicator turn down that may become a signal for a renewal of the downward trend. If the price kickbacks from 0.9130 level that also can prolong a downward movement.
It is now advised to go short with the first target – 0.8968. Should the price break through this level and consolidates over it the next target 0.8859 will be on a roll.
Stop loss we place above the level 0.9145, and if this line goes down, you can move the stop loss after it.
New short positions can be opened if MACD turns down or if the price rebounds from the level 0.9130.
When we get profit of 50 - 60 points, stop-loss can be moved to a breakeven. Take-profit can be set slightly above the target levels by about 5 to 10 points - at the levels of 0.8975 and 0.8865.