The USDCHF is trading at a very narrow point to perpetrating range today. Below comes in near 0.8512. The high comes in near 0.8534. That’s not a lot. So why bother?
The windshield is bigger than the rearview mirror. In other words what the hand is more important than what’s behind. Although you can gather some pretty neat information from the rearview mirror as well. One simple idea is that a non-trending market will transition into a more trending market given time. Markets just don’t go up and down, up and down in a 22 PIP trading range forever.
There are some clues from the rearview mirror that is tilting the bias a little more to the upside:
- The price of the USDCHF moved above both its 200 and 100 hour moving averages yesterday and based near those levels before moving higher. The price needs to stay above its higher 100 hour moving average of 0.85044 to keep the buyers in control. Move below and the bias is more neutral
- The price is also above is a 38.2% retracement at 0.85185. The price today has a trading above and below that retracement level today. If the price can base against that retracement level,move higher and extend above the-high for the day at 0.8535, that could ignite more buying momentum.
Conversely, a move below the 38.2% retracement and the 100-day moving average would be more negative.
This article was written by Greg Michalowski at www.forexlive.com. Source