FxWirePro: Flurry of USD/CHF bearish patterns at channel resistance, can bears breakdown channel support? Major trend still in range

USDCHF minor trend has developed rising channel, consequently, the failure swings were observed at the stiff resistance of 1.0124 levels.

Although one could see the mild rallies from last two days, bulls are restrained below 7-DMAs. CHF performance within G10 FX is relatively mid-range over this period, but that still leaves it as second worst performing currency in this subset YTD.

The streaks of downswings have occurred after back-to-back shooting star, hanging man & 3-black crow patterns have been displayed at the channel resistance, ever since then the prices are plummeted below 7-DMAs (refer daily chart). 

On a broader perspective, the major trend is still stuck in a tight range (1.0330 – 0.87 levels).

While bears pop-up at the stiff resistance and the failure swings have been observed in the consolidation phase of the major downtrend (refer monthly chart), while the momentum oscillators, on this timeframe, signal overbought pressures.

Both RSI and Stochastic curves show downward convergence to the prevailing price slumps to indicate the intensified selling momentum and bearish DMA & MACD crossovers signal downtrend continuation.

For now, the current price is at 0.9894 level which is still well below 7DMAs, if bears manage to breakdown the channel support, then the extension of downtrend seems likely event upon the intensified selling momentum & bearish crossover.

Trading tips: At spot reference: 0.9895 levels, it is wise to snap deceptive rallies and deploy short trades for the downside targets of 0.9859 levels but maintain stop loss of 0.9911 levels. Thereby, one can achieve attractive risk/reward ratio (with 16 pips of risk and 36 pips of returns).

Currency Strength Index: FxWirePro's hourly USD spot index is flashing 21 (which is mildly bullish), while hourly CHF spot index was at 38 (bullish) while articulating (at 07:41 GMT).

For more details on the index, please refer below weblink: http://www.fxwirepro.com/currencyindex