Technical Analysis – USDCHF rangebound as 50-period SMA caps retreat
August 22, 2023 3:28 pm
USDCHF has been steadily gaining ground in the four-hour chart after bouncing off the July double bottom region of 0.8551. Even though the pair has been forming a structure of higher lows in the short term, its failure to post higher highs has been slowly shifting the technical picture to neutral.
The momentum indicators currently suggest that the bullish forces retain the upper hand. Specifically, the stochastic oscillator is ascending after posting a bullish cross in the oversold zone, while the RSI has jumped above its 50-neutral mark.
Should the price edge higher, initial resistance could be met at 0.8838, which is the 61.8% Fibonacci retracement of the 0.9015-0.8551 downleg. Conquering this barricade, the bulls could aim for the 78.6% Fibo of 0.8916. A break above that zone might trigger an advance towards the June resistance of 0.9015.
On the flipside, bearish pressures could send the price lower towards the 50.0% Fibo of 0.8783, which overlaps with the 50-period simple moving average (SMA). If that barricade fails, the 38.2% Fibo at 0.8729, which also coincides with the 200-period SMA, might provide downside protection. Sliding beneath that floor, the price may attempt to challenge the 23.6% Fibo of 0.8661.
In brief, USDCHF appears to be entering a consolidation period in the four-hour chart. However, a break below the 50-period SMA could attract further selling interest and put an end to the pair’s short-term advance.
USDCHF has been steadily gaining ground in the four-hour chart after bouncing off the July double bottom region of 0.8551. Even though the pair has been forming a structure of higher lows in the short term, its failure to post higher highs has been slowly shifting the technical picture to neutral.
The momentum indicators currently suggest that the bullish forces retain the upper hand. Specifically, the stochastic oscillator is ascending after posting a bullish cross in the oversold zone, while the RSI has jumped above its 50-neutral mark.
Should the price edge higher, initial resistance could be met at 0.8838, which is the 61.8% Fibonacci retracement of the 0.9015-0.8551 downleg. Conquering this barricade, the bulls could aim for the 78.6% Fibo of 0.8916. A break above that zone might trigger an advance towards the June resistance of 0.9015.
On the flipside, bearish pressures could send the price lower towards the 50.0% Fibo of 0.8783, which overlaps with the 50-period simple moving average (SMA). If that barricade fails, the 38.2% Fibo at 0.8729, which also coincides with the 200-period SMA, might provide downside protection. Sliding beneath that floor, the price may attempt to challenge the 23.6% Fibo of 0.8661.
In brief, USDCHF appears to be entering a consolidation period in the four-hour chart. However, a break below the 50-period SMA could attract further selling interest and put an end to the pair’s short-term advance.
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