USD/CHF Price Prediction: Breaks Above 200-Day SMA And Continues Higher
- USD/CHF extends its established bull trend higher.
- The RSI momentum indicator is flashing overbought suggesting increased risk of a pullback.
USD/CHF breaks above the 200-day Simple Moving Average (SMA) and extends its short and medium-term uptrend.
USD/CHF Daily Chart
(Click on image to enlarge)
Given the technical analysis theory that “the trend is your friend” the odds favor more upside.
However, the Relative Strength Index (RSI) momentum indicator is overbought which advises long holders not to add to their long positions because of the increased risk of a pullback. If a pullback does evolve it will provide a good opportunity to buy at a lower price and catch the uptrend before it resumes. Any correction is likely to find solid support at the 200-day SMA at around 0.8825-30.
The pair has surpassed the target at 0.8873 (July 30 swing high) and is on its way to the next target at 0.9050 (July 2 swing high). Another possible target is 0.9000 due to its significance as a round-number and psychological level.
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