USD/CHF Continues Consolidation Move
11/07/2002 12:00 am EST
The dollar recently put in new all-time lows against the Swiss franc, and with the bearish trend still prevailing, Fibonacci is used to project the next potential downside target.
By James Chen
Price action on USD/CHF (a four-hour chart of which is shown) as of Monday (Mar. 7) has continued its trading range consolidation within the context of a clear and strong bearish trend that has been in place for around a month.
(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.)
The current consolidation has prevailed for the last week and a half, with its upper border around key 0.9330 resistance and its lower border at the new all-time low at 0.9200, which was established just last week.
In the event that this 0.9200 all-time low is broken to the downside, thereby confirming a continuation of the entrenched downtrend, a key downside support target in uncharted territory resides around the 0.9050 price region, which is the 161.8% Fibonacci extension of the latest major bullish run.
Significant resistance within the context of the strong current bearish trend continues to reside around the noted 0.9330 price region.
By James Chen, chief technical strategist, FXSolutions.com