Price action on USD/CHF (a four-hour chart of which is shown) as of Wednesday (October 27) has broken out above a key downtrend resistance line and established a new one-month high in the process. This trend line break significantly disrupts the steep downtrend that has been in place since the early-June high.
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(Price on first pane, Slow Stochastics on second pane; horizontal support/resistance levels in yellow; uptrend lines in green; downtrend lines in red; chart patterns in white; 50-period simple moving average in light blue.)
Currently, price has bumped up against key resistance in the 0.9900-0.9930 price region, a key support/resistance juncture. In the event of continued bullish momentum on the trend line breakout, a strong breakout above 0.9930 should target immediate upside resistance around the 1.0060 price region, a significant prior support/resistance level.
By James Chen, chief technical strategist, FXSolutions.com
