• The USD/CHF has rallied rather significantly during trading on Thursday, after bouncing from the recent lows that we made against the Swiss franc.
• The 0.9233 level seems to be a bit of a support level, and now that we have broken above the top of what looks to be a falling wedge, one would assume that the US dollar may get a little bit of a boost.
• This Giants quite well with what I’m seeing around the Forex markets, so seeing the USD/CHF pair trade near the 0.95 level is what I am looking for.

It’s worth noting that the 50-Day EMA is in that same area as well, so I think it’s probably only a matter of time before we would see a little bit of selling pressure in that area. Quite frankly, we could even go to the 200-Day EMA, which sits right around the 0.96 level. That’s an area that I think a lot of people would pay close attention to, and therefore it would make a nice target. Furthermore, it is also the top of the falling wedge, so it all comes together quite nicely. Anything above that level could send this market much higher, perhaps sending the US dollar back to parity against the Swiss franc, but we would need to see a lot of US dollar strength across the board to make that happen.
 

Value Hunters Looking to Pick Up the Dollar

I believe at this point, the pair is trying to find a bottom and when you look at the longer-term charts, this is a support area that does matter quite significantly. With that being the case, I think that a lot of value hunters are coming in to pick up the US dollar, and we will more likely than not continue to see that play out. Expect choppiness regardless of what happens next, and therefore you need to be cautious with your position size and recognize that you may need to widen your stops.

This can be achieved by bringing that position size lower, and therefore you need to play the long game when it comes to the spare right now, especially as the holiday season will have a lot of players out of the game. I suspect that by the time we get into the jobs report in January, we should have a bit more clarity, but between now that it looks like we may try to recover.

(Click on image to enlarge)

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