20, January 2015

USD/CHF (a 4-hour chart)

USD/CHF (a 4-hour chart)

General overview

The liquidity volume will continue to be small after the Swiss National Bank canceled the lower limit for the euro/franc on Thursday that is 1.20, it lowered interest rates on deposits for demand by 0.5% to -0.75%.

The demand for the franc puts pressure on the pair against other major currencies. Its potential decrease is constrained by its sales at the low levels, the positive market’s attitude to the dollar, Switzerland negative interest rates and the likelihood of intervention by the Swiss National Bank.

The price is finding the first support at 0.8740, the next one is at 0.8540. The price is finding the first resistance at 0.8940, the next one is at 0.9150.

There is a confirmed and a strong sell signal. The price is under the Cloud and it is under the Chinkou Span. The Tenkan-sen shows a downward movement and the Kijun-sen shows a horizontal movement. The downward movement will be until the price is under the Cloud.

The MACD indicator is in a negative territory. The price is correcting.

Trading recommendations

The pair is consolidating now. We advise to short with the first target - 0.8540. When the pair consolidates below the first target, we can open deals to the level of 0.8340.