16, May 2014

USD/CHF (a 4 hour chart)

USD/CHF (a 4 hour chart)

General Overview

The Swiss franc rose against the dollar, as the dollar index for the first time in the last four trading sessions suffered losses against the major currencies basket in the light of Treasury obligations yields falling because of speculation over whether the ECB will take action under the monetary policy liberalization and counter deflation.

Published statistics showed that the April U.S. producer price index was 2.1 % vs. 1.7 % and 1.4 % in March. Basic PPI reached 1.9 % versus 1.4 % and 1.4 %, respectively.

The first support is 0.8890, the next one is 0.8850. The first resistance is 0.8920, the next is one 0.8950.

The price is above the Cloud and above Chinkou-Span, that’s a strong and confirmed buy signal.

The upward movement remains until Kijun-Sen is under the price.

MACD is in the positive territory that supports the growth.

Trading recommendations

After rising to 0.8907 the dollar/franc consolidated below this level. Demand dips towards 0.8882 are still present, but the dollar is showing overbought signs, which could lead to more below bounce. Decrease towards 0.8860-0.8820 should be used to open long positions.