USDCHF Bounces off Its Confluence Zone to Maintain Uptrend

USDCHF Analysis – The Market Bounces off Its Uptrend Confluence Zone

USDCHF bounces off the confluence zone of its uptrend line and a descending channel within the key levels of 0.91570 and 0.91070. Following a decline in liquidity, the market retested the 0.92190 price line before dropping below the 0.91570 significant level and getting confined below it by the 0.91070 weekly support. An accumulation that spanned 10 trading days occurred after which USDCHF bounces higher off the confluence zone.

USDCHF Important Zones

Resistance Zones: 0.92190, 0.93350, 0.93770
Support Zones: 0.91570, 0.91070, 0.90350
USDCHF bulls have generally been pushing the market up with a prevailing regularity despite many irregularities. The market can be observed to record consistently higher lows. This trend has continued in the latest price setup. As per making higher highs to complement the bullish, there has been a bit of a struggle as the 0.93350 resistance level has been a major hindrance for higher moves.

This 0.93350 resistance level facilitated the fall in prices using a head and shoulder market reversal pattern. This led to a drop in the price to the 0.91570 support level. USDCHF, thereafter, dropped into consolidation below the level. From here, the market bounces out of this consolidation and is pumped back to the 0.93350 resistance. An initial rejection is making the price drop for a retest. We expect the market to rise again to test the 0.93350 resistance a second time.

Market Anticipation

On the 4-hour chart, the market is pulling back after hitting the resistance level. Both the Parabolic SAR (Stop and Reverse) and the MACD (Moving Average Convergence Divergence) indicators are witnessing the current pullback in the market. However, drawing a Fibonacci ratio on the 4-hour chart, the price has dropped to the 61.80% level, is now showing reversal candlesticks, which signals a market reversal.
When the price reverses, USDCHF is expected to bounce off the Fibonacci ratio to break through the 0.93350 price level.

Note: Forexschoolonline.com is not a financial advisor. Do your research before investing your funds in any financial asset or presented product or event. We are not responsible for your investing results.