20, September 2013

USD/CHF (a 4 hour chart)

USD/CHF (a 4 hour chart)

General Overview

U.S. Fed extremely surprised participants in the FX market on Wednesday having announced its decision at the last moment. The dollar fell, allowing the European currencies to break the strongest resistance levels. On the daily chart the pair USD/CHF hit seven-month low having lost more than 100 points. We believe that the price will recover its previous values within 5-6 days, so long positions as topical as ever. Growth rates to the level of 0.9264 will contribute to a good performance of the manufacturing sector in the States. Investors are also worried of reducing its key interest rate the Swiss National Bank, which would weaken the CHF.

Kijun-sen is above Tenkan-Sen. Tenkan-sen is directed downward, the Kijun-Sen is directed down. Chinkou Span is above the price chart, the cloud is still neutral. The upward movement is canceled for the moment, the pair returned into the cloud and broke it at the end of the week.

The pair will return to the downward movement after the return under the Kijun-sen and the Cloud what is happening now. If the price returns above the Kijun-sen, the sell signal will be weakened and the further growth will be put under question.

Bollinger Bands indicator follows the price down. The bands are narrowing.
The MACD histogram is in a negative area.

Trading Recommendations

The pair tested low at 0.9108 being in a stable flat.

We recommend opening long positions with take-profit at higher levels 0.9154 and 0.9175.