USD/CHF – US GDP data due tonight following an interesting presidential debate earlier which commenced a 2% drop in the Nasdaq and E-mini S&P.

USD/CHF

As money moves out of equities due to increase in risk, the money tends to park itself in safer assets giving the DXY (Us Dollar) strength.

usd/chf

The daily chart is sitting above the 50 EMA and at a key level of support (0.91800) from March low.

USD/CHF can drop to retest this level breaking the low on the 1 hour time frame.

 

Key Points:

  • Daily – Above 50 EMA
  • Daily – Below 200 EMA
  • Daily – RSI channel to follow through to oversold territory
  • Price holding above the 200 EMA
  • Price holding above the 50 EMA
  • Crossed daily trend line

 

Key Levels:

Support – 50 EMA, 0.92145, 200 EMA, 0.91910, 0.91800

Resistance – 0.92600, 0.92960

 

Entry Zone:

Optimal entry provides the greatest reward to risk ratio while supporting entry is a zone for reversal signals.

Optimal Entry – 0.91900

Supporting Entry – 0.92145

 

Candle Reversals for entry

  • Bullish Hammer
  • Bullish Engulfing
  • Bullish PiercingBullish Candlesticks

 

The Risk:

As traders, it is your job to mitigate the risk and only trade structures that provide high probability and great reward to risk ratios.

If you are not comfortable with defined exit levels, experiment with Moving Averages to help set solid exit rules to protect your capital.

 

IF: Price breaks below 0.91687 and violates 200 EMA – this would suggest the structure is not in our favour and would be wise to reduce exposure or close the trade until a solid signal gives us reasons to re-enter.

 

Reward / Reward Targets:

Optimal Entry 0.91900 – Target 1 0.92960 = 5x Reward to Risk

Supporting Entry 0.92145 – Target 1 0.92960 = 2x Reward to Risk