USDCHF Should Stay Above 0.9010 Handle

26 August 2020

USDCHF seems to have completed its corrective drop towards 0.9060 levels earlier and is looking to resume its rally. Over the medium term, bulls are expected to remain in control and push prices through 0.9250, 0.9500 and beyond.

USDCHF probable wave counts are as follows: The entire drop from 1.0237 through 0.9010 seems corrective, potential double zigzag. If the above structure is correct, USDCHF should rally towards 0.9800/0.9900 resistance over the next few weeks.

The drop through 0.9010 was the last lower degree wave within Wave C. The currency had produced a rally through 0.9161 levels, sub-dividing into 5 waves. Hence a lower degree Wave 1 might be in place between 0.9010 through 0.9161 levels respectively.

Going further, the drop towards 0.9060 levels seems corrective and might be labelled as potential Wave 2, of a similar degree. If the above proposed counts are correct, USDCHF should stay above 0.9010 and push higher towards 0.9250 at least.

Also note that lower degree Wave 2 (not labelled here), had found support from 0.9060, which is fibonacci 0.681 retracement of Wave 1. At the moment, USDCHF is drifting sideways but should soon terminate close to 0.9060 and resume higher.

Traders might be inclined to hold long positions initiated around 0.9060 mark, with a protective stop towards 0.9000 and projected targets towards 0.9500 at least. Only a consistent break below 0.9000 would delay matters further.

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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