The market structure on USDCHF has been bearish with LL’s and LH’s being formed. Market tapped the 0.9160 support level and then, started to range. The resistance level of 0.9240 is the level we will be looking to short. At the support level, it makes sense to buy the USDCHF, but given that the trend is down, it would be risky to do so.

For the trendline structure, we have a corrective bearish pennant being formed. If market breakouts sell from this ascending trendline, we might be able to take a short position instead of waiting for the market to tap the resistance.

At the resistance level of price 0.9240, we have a confluence of the golden retracement level of 75-78.6%. This retracement having a confluence on the resistance level highlights the strength of this region. This impulse wave would continue down towards the 0 retracement level.

Both the EMA 50 and EMA 200 are in a bearish sentiment, with a bearish death cross impending. After the breakout sells of the EMA 50, market was unable to retest at the EMA 50. At the resistance level, we anticipate a retest of the EMA 50 or EMA 200. This EMA 50 will give us a second factor for sells.

With the oscillators, both are in the over-sold region. The RSI is at the 46 levels, whereas CCI is at -64. We need to wait for the oscillators to neutralize the levels and then continue down.

This setup has several confluence factors at the resistance level. If the market taps the level of resistance, we may be able to get a good risk to reward setup for the bearish impulse.

USDCHF continuing downtrend

Dec 02 2021

1