PAXFOREX : USDCHF Support Zone

The USDCHF has contracted after reaching a multi-month high as visible in this D1 chart. USDCHF bulls have called for a rally to test the 1.000 level, but this currency pair has corrected sharply and the drop was halted by this currency pair’s 50 DMA which also enforces the upper band of the support zone. The last two daily candlestick formations have formed an inverted hammer as well as hammer formation at support which is a bullish indicator. We expect this pair to stabilize within its support zone which sees its lower band enforced by its 200 DMA.

MACD has contracted, but remains in bullish territory. The sharp contraction caused a gap to form between the moving average and the histogram which we believe will be closed during the pending move higher and we do expect it to remain in bullish territory overall. RSI has contracted from extreme overboughtconditions to neutral territory and may not collapse into oversold territory.

We recommend a long position at 0.9470 with a potential second entry level at 0.9370. We also recommend a stop sell order at 0.9400 in order to hedge the initial long position.

Traders who wish to exit this trade at a loss are advised to place their stop loss order at 0.9400. We will not use a stop loss order for this trade and will execute this trade as recommended. Place your take profit level at 0.9670.

Here are the reasons we call the USDCHF currency pair higher

• USDCHF has corrected sharply from recent highs and the drop was halted by the upper band of its support zone
• The upper band of its support zone is enforced by this currency pair’s 50 DMA
• The lower band of its support zone is enforced by this currency pair’s 200 DMA and we believe this currency pair will stabilize in the support zone given the overall strength of the zone
• A short covering rally in order to lock in profits before Friday’s U.S. employment snapshot for May
• Bargain hunters who seek to take advantage of the support zone

Open your PaxForex Trading Account and add this currency pair to your forex portfolio.

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Disclaimer The analysis we provide is based on the average estimate of price movements in one day. Does not guarantee what we deliver is actually a proper and correct. Everything that happens in the decisions you make on your trading transaction is to be Your responsibilities. Visit Us www.deryworldscorp.web.id Visit Us www.deryworldscorp.asia