Sellers in USDCHF take the price back below retracement target giving sellers some hope.

The USD/CHF pair initially rose today, testing a critical zone between 0.8982 and the psychologically significant level of 0.9000. However, sellers stepped in at the upper boundary of this zone, driving the price lower. Notably on the downside, the pair has now breached the 38.2% retracement level from the July low at 0.89808, marking an important technical break that strengthens the bearish sentiment. This level now serves as a close risk for sellers anticipating further declines today. Staying below is more bearish.

On the downside, the next target area is around the swing area between 0.89316 and 0.8947. A move below this zone would have traders targeting a cluster of support, defined by the 100-day moving average (blue step line on the chart below), the 50% midpoint of the rally from the July low, and several swing levels dating back to late August and early September. They are all converging near 0.8899 (rounded to 0.8900).

While this area may pose a tough level to get through (at least on the 1st look), it represents a pivotal target for sellers seeking additional downside movement in the USD/CHF pair.

This article was written by Greg Michalowski at Source