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Home ANALYSIS

USDCHF falls below rising 100 hour AM after run toward Friday’s high stalls

A.R Chowdhury by A.R Chowdhury
April 11, 2022
Reading Time: 5 mins read
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USDCHFf

USDCH sellers push below the 50%/100 hour moving average.

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The  USDCHF 
USD/CHF

The USD/CHF is the currency pair encompassing the dollar of the United States of America (symbol $, code USD), and the Swiss franc of Switzerland (code CHF). The pair’s exchange rate indicates how many Swiss francs are needed in order to purchase one US dollar. For example, when the USD/CHF is trading at 1.2500, it means 1 US dollar is equivalent to 1.25 Swiss francs. The US Dollar (USD) is the world’s most traded currency, whilst the Swiss franc (CHF) is the world’s sixth most traded currency, resulting in a very liquid pair, with tight spreads, often staying within the 0 pip to 2 pip spread range on most forex brokers. Even though the Swiss franc might not be as liquid as the euro or yen, the USD/CHF currency pair is still liquid enough to be known as the fourth major. Trading the USD/CHF has its advantages and disadvantages. The main advantage being, a lot of traders often prefer to invest in the Swiss franc when economic or political instability is lurking.This is due to Switzerland traditionally being known as a safe haven, as it generally remains neutral and silent on many major geopolitical events, for example it never participates in wars. These investments can trigger large swings for traders, who may capitalize on such moves. The main disadvantage is that the US dollar is the world’s reserve currency.Thus, traders also can flock to the USD, trying to ascertain which currency is more likely to be embarked upon can prove tough at times. USD/CHF Still Living in Shadows of 2015The USD/CHF otherwise is seen as one of the lesser volatile pairs, with a tendency to follow the Euro, hence the negative correlation between it and the EUR/USD.The currency pair will forever be tethered to the events of January 2015 with the Swiss National Bank (SNB) Crisis which roiled currency markets.In this instance, the SNB abruptly decided to abandon the Swiss franc (CHF) currency peg with the euro, convulsing markets.

The USD/CHF is the currency pair encompassing the dollar of the United States of America (symbol $, code USD), and the Swiss franc of Switzerland (code CHF). The pair’s exchange rate indicates how many Swiss francs are needed in order to purchase one US dollar. For example, when the USD/CHF is trading at 1.2500, it means 1 US dollar is equivalent to 1.25 Swiss francs. The US Dollar (USD) is the world’s most traded currency, whilst the Swiss franc (CHF) is the world’s sixth most traded currency, resulting in a very liquid pair, with tight spreads, often staying within the 0 pip to 2 pip spread range on most forex brokers. Even though the Swiss franc might not be as liquid as the euro or yen, the USD/CHF currency pair is still liquid enough to be known as the fourth major. Trading the USD/CHF has its advantages and disadvantages. The main advantage being, a lot of traders often prefer to invest in the Swiss franc when economic or political instability is lurking.This is due to Switzerland traditionally being known as a safe haven, as it generally remains neutral and silent on many major geopolitical events, for example it never participates in wars. These investments can trigger large swings for traders, who may capitalize on such moves. The main disadvantage is that the US dollar is the world’s reserve currency.Thus, traders also can flock to the USD, trying to ascertain which currency is more likely to be embarked upon can prove tough at times. USD/CHF Still Living in Shadows of 2015The USD/CHF otherwise is seen as one of the lesser volatile pairs, with a tendency to follow the Euro, hence the negative correlation between it and the EUR/USD.The currency pair will forever be tethered to the events of January 2015 with the Swiss National Bank (SNB) Crisis which roiled currency markets.In this instance, the SNB abruptly decided to abandon the Swiss franc (CHF) currency peg with the euro, convulsing markets.
Read this Term
has just broken back below it’s 100 hour MA (and rising) at 0.93284. In the process, the price has also moved below the 50% midpoint of the move down from the March 16 high at 0.93268 as well. The combination of technical levels, tilts the intraday short term bias back in the favor of the sellers.

Earlier today, the price in Asian session did find support buyers against the 100 hour moving average level. Holding that moving average level led to a move higher with the price reaching a peak in the European session. That high, however, stalled just ahead of the high from Friday’s trade. The high today reached 0.93713. The high from Friday reached just a few pips higher at 0.93734. Moreover the high from Friday was right near the high from March 29 near the same level.

The inability to get above that ceiling level turned buyers and the sellers, which has culminated in the breaking of the 100 hour moving average just recently.

What next?

Getting below 0.93164 would be the next target on further downside momentum. That is the low of a swing area from Wednesday and Thursday’s trade

Traders will now use the 100 hour moving average and the 50% midpoint as close risk (it is a break after all). I would expect intraday traders playing the break to give it a few pips above the 100 hour moving average for risk.

On the downside, breaking 0.93164 would have traders looking toward 0.9295 area (call it 0.9300). Below that is the flat/rising 200 hour moving average at 0.93883. The price moved above the 200 hour moving average on Tuesday of last week, and stayed above that as it tilted the bias back in the buyers direction.

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A.R Chowdhury

A.R Chowdhury

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