31, January 2013

USD/CHF (a 4 hour chart)

USD/CHF (4 hour chart)

The dollar/franc continues to work out a sell signal. The price is still in a strong down movement having worked out the last support level. The current sell signal is confirmed and strong as Chinkou Span entrenched below the price chart and the price is below the Ichimoku cloud. Now the goal of the downward movement is the third level of support 0.9081 which price has almost worked out.

If the price fixes below the first target then it will go for the second one – 0.9025. The downward movement is maintained as long as the price is below the Kijun-sen (0.9195). If the price fixes above this line a sell signal will weaken. That will also make possible its movement to the upper boundary of Ichimoku cloud.

Chinkou Span is below the price chart that confirms the current sell signal and indicates a bearish mood of traders.

Bollinger Bands show continued downward movement, the bands widen and downwards. You should consider short positions.

MACD currently falls, signaling the downstream movement, its turn upward may be a signal for a correction. If the price bounces from 0.9081 it could also provoke a corrective movement.

Trading recommendations

It is recommended to consider short positions with the first target – 0.9081. After price fixing below the first target, you need to consider the level 0.9025 as the second target.

Stop loss should be placed above 0.9195 and if this line goes down you can move the stop loss after it. One can close orders manually if MACD turns up or the price bounces from the level 0.9081. When you reach profits of 50 - 60 points, stop-loss can be moved to zero level.

Take-profit can be slightly set above the target levels – 0.9090 and 0.9030. In addition to the technical picture please consider the fundamental news when opening orders.