Awesome P.A being seen on the USD/CHF...
Consequent to yesterday’s 140-pip sell-off, we’ll begin looking at the weekly chart this morning. The support area at 0.9796-0.9902 was recently breached, potentially opening the path south for further selling down to a Quasimodo support level at 0.9526. However, it may be worth waiting for the weekly candle to close up shop before presuming that this weekly area is consumed.
Turning our attention to the daily chart, both demand (now supply) at 0.9851-0.9926 and support (now resistance) at 0.9822 were completely obliterated during yesterday’s bearish assault. This, as you can see, leaves the runway clear down to test trendline support extended from the low 0.9078 and the Harmonic Gartley reversal zone (78.6% Fibonacci level at 0.9669/127.2% Fibonacci extension at 0.9651).
Steeping down one more level to the H4, it’s clear to see that the bulls did not make an appearance yesterday until crashing into psychological support 0.9700. Looking to buy from 0.9700, when both the weekly and daily charts show room to move lower is not something we’d stamp high probability. This is, in our opinion, likely profit taking we’re seeing here. The level we have our eye on currently is the daily trendline support mentioned above since it converges beautifully with a Harmonic Gartley buy zone (see above). This is a little worrying for us since we’re currently short the EUR/USD! Nevertheless, traders should keep an eye on this area today as it will likely bounce prices higher – we would recommend waiting for lower timeframe confirmation here since the buy zone is relatively small and likely prone to a fakeout. With regards to targets, our first port of call would be the daily resistance level coming in at 0.9822.
Levels to watch/live orders:
• Buys: 0.9651/0.9669 Tentative – confirmation required (Stop loss: dependent on where one confirms this area).
• Sells: Flat (Stop loss: N/A).
Turning our attention to the daily chart, both demand (now supply) at 0.9851-0.9926 and support (now resistance) at 0.9822 were completely obliterated during yesterday’s bearish assault. This, as you can see, leaves the runway clear down to test trendline support extended from the low 0.9078 and the Harmonic Gartley reversal zone (78.6% Fibonacci level at 0.9669/127.2% Fibonacci extension at 0.9651).
Steeping down one more level to the H4, it’s clear to see that the bulls did not make an appearance yesterday until crashing into psychological support 0.9700. Looking to buy from 0.9700, when both the weekly and daily charts show room to move lower is not something we’d stamp high probability. This is, in our opinion, likely profit taking we’re seeing here. The level we have our eye on currently is the daily trendline support mentioned above since it converges beautifully with a Harmonic Gartley buy zone (see above). This is a little worrying for us since we’re currently short the EUR/USD! Nevertheless, traders should keep an eye on this area today as it will likely bounce prices higher – we would recommend waiting for lower timeframe confirmation here since the buy zone is relatively small and likely prone to a fakeout. With regards to targets, our first port of call would be the daily resistance level coming in at 0.9822.
Levels to watch/live orders:
• Buys: 0.9651/0.9669 Tentative – confirmation required (Stop loss: dependent on where one confirms this area).
• Sells: Flat (Stop loss: N/A).
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