USD/CHF Price Analysis: Downside risk below 21-day SMA, ascending trendline near 0.9230
19.10.2021, 23:18

USD/CHF Price Analysis: Downside risk below 21-day SMA, ascending trendline near 0.9230

  • USD/CHF edges lower on Wednesday in the Asian session.
  • Higher highs and higher lows depict the upside trend in the pair since August 30.
  • MACD holds onto the overbought zone with receding upside momentum.

USD/CHF remains muted on  Wednesday in the initial Asian trading hours. After testing the low of 0.9185 in the US session, the pair managed to close higher while composing more than a 50-pips movement. At the time of writing, USD/CHF is trading at 0.9298 down 0.02% for the day.

On the daily chart, the USD/CHF pair has been trading in a rectangle formation in a range of 0.9220 and 0.9230 since September 15. The spot showed a weakening trend after it slipped below the 21-day Simple Moving Average (SMA) at 0.9275. Further, the mid-term uptrend from the low of 0.9018 made on August 4 invalidated after USD/CAD breaks below the bullish slopping line in the previous session.

Having said that, If the price break below the intraday low it could immediately test the psychological 0.9200 mark followed by the low made on September 15 at 0.9163. Furthermore, the Moving Average Convergence Divergence (MACD) trades in the overbought zone with receding upside momentum. Any downtick in the MACD would encourage the USD/CHF bears to test the 0.9140 horizontal support level.

Alternatively, if the price reverses direction then the possibility of meeting the 0.9250 horizontal resistance level emerges. A daily close above the 21-day SMA will fuel the upside rally toward the 0.9300 horizontal resistance level, and then the October, 1 high of 0.9337.


 

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