Saturday, January 1, 2011

FX Tech Lab: Update 3 – USD/CHF Reaches Fresh All-time Low

http://www.forex.com/uk/post?SDN=c28e5c52-42ab-41d5-bde6-6e5cfb6e1871&Pa=20db1fa6-e674-420c-9a87-2ee29261d638

Last week we looked  for USD/CHF to break to a new all-time low after the technical landscape became increasingly bearish – Click here if you missed it. This week as we continued to ride the wave of Swiss strength, the pair finally broke to a new record low. We believe month-end/year-end rebalancing flows contributed to this move, as well as seasonal USD weakness during the month of December – For more, see our FX Seasonal Patterns: December Outlook. As such, while there is little from a technical perspective implying a USD turnaround, it may be prudent to take our profits before the current trading environment becomes too illiquid ahead of the holiday weekend.
KEY TECHNICAL LEVELS:
  • Long-term Trendline Resistance at 0.9800 (in black)
  • Key Topside pivot 0.9720/40 (in grey)
  • Prior All-time low = 0.9465 (10/14)
  • Today’s Fresh All-time low = 0.9455 (so far)
  • Channel width from point of breakdown = 0.9340/50 (in red)
Our view of a final push to a new all-time low (sub-0.9465) has been achieved, thus we should be flat.
I wish you and your families a happy, healthy and prosperous New Years. See you in 2011!
Chart Source: Forex Charts by eSignal
Chris Tevere, CMT
Senior Technical Strategist
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Disclaimer: The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.

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