USD/CHF falls below 50-Day SMA; Does it mean Bearish Trend Continuation?

USD/CHF Technical Analysis

USD/CHF Technical Analysis

The forex pair USD/CHF Daily Price chart shows strong bearish trend continuation signals. The price fell below the 50-Day Simple Moving Average, which stands at 0.92426. The bears might be more optimistic as the Moving Average Convergence & Divergence (MACD) has entered into negative territory below its zero line. Furthermore, the Relative Strength Index (RSI) is heading north to the oversold region after crossing the 50-region from above. Meanwhile, the Stochastic Oscillator is also moving towards the oversold region with the %D line following the negative slope of the %K line.

In the negative scenario, any break below the initial support line will strengthen the bearish pressure towards the second support at 0.09145. If bears remain in power, the currency pair USD/CHF might fall below the 0.9000 psychological level.

However, in the positive scenario, the currency pair USD/CHF will have to climb above the initial resistance at 0.92426. It is the same level where 50-Day SMA is standing. From here, the market will challenge the next resistance at 0.93415, where the 100-Day SMA is resting.  Additional gains in upside momentum could lead the price towards the third resistance of double top at 0.94448.

Overall, there are more chances of a bearish trend continuation in the daily price chart of USD/CHF. The idea is to wait for the price to make a low below 0.90987 level before entering a short position.

Sometimes magic is just someone spending more time on something than anyone else might reasonably expect.

Raymond Joseph Teller