The USDCHF has moved higher this week. The low was reached on Monday. The high was reached in trading today. At session highs, the price reached the low of a swing area on the daily chart between 0.88167 and 0.8838. In trading next week, if the buyers are to take more control they would need to get above 0.8838 level.
Drilling down to the hourly chart below, the 38.2% retracement of the move down from the end of October high to the December 1 low comes in at 0.8836 just two pips lower than the 0.8838 target on the daily chart. The same resistance target near 0.8838 on both the daily and the hourly chart increases at levels importance, and makes it a key barometer going into the new trading week.
So traders next week will have a choice.
- Do they go higher above the 0.8838 level and extend toward higher targets including the 100-day moving average?
- Is the 0.8838 level a resistance target that attracts new dollar sellers and leads to a resumption of the most recent downward trend in the USDCHF?
That is what will be decided next week near the 0.8838 level.
For a detailed look at the charts defining these levels, watch the video above. Be aware. Be prepared.
This article was written by Greg Michalowski at www.forexlive.com. Source