The USDCHF hit a new low in the European session, marginally breaching the low price from July 18, but quickly bounced back. The rebound was fueled by robust U.S. data released this morning, indicating a stronger GDP, job market, and consumer/business market, with durable goods also trending higher.
From a technical perspective, the surge propelled the price back above its 200-hour moving average of 0.86248, and subsequently above its 100-hour moving average at 0.86469. The day’s peak so far has been 0.8694, barely shy of the highs from Monday and Tuesday around 0.8699.
Adding to this zone’s significance, it is in close proximity to the 2014 low of 0.8696. Thus, the 0.8700 level in USDCHF has become a critical point of resistance, relevant not only in the short-term hourly chart context, but also from a historical perspective dating back to 2014.
This level will serve as a key determinant for market sentiment— a breakthrough above 0.8700 could signal a bullish market, while failure to surpass it might imply continued bearish control.
This article was written by Greg Michalowski at www.forexlive.com. Source