CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Open account
☰
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Open account
✖

USD CHF Friday s Piercing Candle May Target 9800 Next

Article By: ,  Financial Analyst
September 21, 2015 3:01 PM

Autumn (in the Northern Hemisphere) doesn’t officially start until Wednesday, but based on today’s lackluster trading, traders are already feeling the end-of-summer blues. Global equities are edging higher in relatively quiet trade, global bonds are mixed, and the greenback is ticking up modestly, extending the bullish momentum from Friday’s big bullish reversal.

Of all the major currency pairs, USD/CHF is arguably one of the most interesting. The unit fell dramatically Friday morning, hitting the 50% Fibonacci retracement at .9540 before reversing to surge all the way back above the 50-day MA (.9660), where it finished the week. The big intraday reversal created a clear Piercing Candle* on the daily chart, showing a shift from selling to buying pressure and hinting at a possible continuation higher this week.

For its part, the daily Slow Stochastics indicator is showing signs of turning higher; previous bottoms in this indicator have marked rallies in USD/CHF, though the last three bottoms came from oversold territory first. Despite this difference, a confirmed cross above the signal line (%D) in the Slow Stochastics would certainly be a constructive sign.

At this point, more upside is favored in USD/CHF, with bulls potentially looking to drive the pair back up toward its six-week high at .9820 or even the six-month high near .9900. On the other hand, a reversal back below the 50-day MA at .9660 would erase the bullish bias and point to more consolidation in the near term.

Key fundamental data / news that may impact USD/CHF this week (all times GMT):

Today: US Existing Home Sales (14:00)

Tuesday: Swiss Trade Balance (6:00)

Wednesday: No significant data

Thursday: US Durable Goods Orders (12:30), US New Home Sales (14:00), Fed Chair Yellen Speaks (21:00)

Friday: US Final Q2 GDP (12:30)

*A Piercing Candle is formed when a candle trades below the previous candle’s low, but buyers step in and push rates up to close in the upper half of the previous candle’s range. It suggests a potential bullish trend reversal.

Source: City Index

StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. CFD and Forex Trading are leveraged products and your capital is at risk. They may not be suitable for everyone. Please ensure you fully understand the risks involved by reading our full risk warning.

City Index is a trading name of StoneX Financial Ltd. Head and Registered Office: 1st Floor, Moor House, 120 London Wall, London, EC2Y 5ET. StoneX Financial Ltd is a company registered in England and Wales, number: 05616586. Authorised and regulated by the Financial Conduct Authority. FCA Register Number: 446717.

City Index is a trademark of StoneX Financial Ltd.

The information on this website is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement.

© City Index 2024