USDCHF Is Close To Taking Our 0.9250 Resistance

23 September 2020

USDCHF bulls seem to be preparing to take out initial resistance at 0.9250 in the near term. Overall, the structure continues to remain bullish against 0.9000 lows and the currency is expected to push towards 0.9400/0.9500 levels over the next several weeks.

USDCHF probable wave structure is as follows: The drop from 0.9900 through 0.9000 has been in 3 waves, hence corrective. Probabilities remain for a rally towards 0.9900 resistance, retracing the entire drop. Also note that bulls might push towards 1.0237 levels as well.

Looking at the short term wave structure, USDCHF might have carved a meaningful bottom around 0.9000 levels. The rally between 0.9000 and 0.9200 could be marked as a lower degree Wave 1 (not labelled on the chart here). The above rally was an impulse wave, which was followed by a corrective drop towards 0.9060 levels, potential Wave 2 (not labelled here).

If the above proposed structure holds well, USDCHF should stay above 0.9060 mark and broadly above 0.9000 handle in case of an expanded flat. Further, bulls should remain in control and push higher towards 0.9400/0.9500 resistance as Wave 3 progresses.

Also note that potential Wave 2 had terminated around fibonacci 0.618 of wave 1 around 0.9050/60 mark. The backside of past resistance turned support trend line has also helped USDCHF bulls to push higher from the above mark.

Traders might remain poised to hold long positions taken earlier and also look to add further on dips towards 0.9050 levels. The protective stop remains below 0.9000 while projected target points towards 0.9500 and higher.

Prepared by
Technical Analysis Team

Disclaimer: This information has been produced by a third party, for general information purposes only, and is not indicative of future results. Abans Global takes no responsibility for its accuracy or completeness. Any opinions expressed do not reflect those of Abans Global. This information does not take into account your personal circumstances or objectives, and should therefore not be interpreted as financial, investment or other advice, or relied upon as such. You should seek independent advice before making investment decisions. Reproduction of this information, in whole or in part, is not permitted. Please note: If you are a Professional client, you are not eligible for negative balance protection and you could lose more than your initial deposit.

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