Tuesday December 23, 2008 - 16:37:09 GMT
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Chart of the Day - 12/23/2008 - USD/CHF
(Chart courtesy of FX Solutions' FX AccuCharts. Price on 1st pane, Slow Stochastics on 2nd pane; uptrend lines in green; downtrend line in red; horizontal support/resistance lines in yellow; Fibonacci retracements in grey; 50-period simple moving average in light blue.)
12/23/2008 â€“ USD/CHF â€“ After plummeting more than 1800 pips since early December, price action on the USD/CHF (a daily chart of which is shown) corrected to the 38.2% Fibonacci retracement level, and then has dropped back down substantially within the past couple of days. From a technical perspective, this appears very much like a classic 38.2% pullback within an overall downtrend. Of course, a continuation of the downtrend would not be confirmed unless price actually broke below the 1.0400 price region, which is the approximate level of the last extreme low (the bottom of the 1800-pip plummet). Therefore, 1.0400 should act as major support to the downside, with the 1.0700 region as intermediate support. In the event of an impending bounce back up within the context of a holiday consolidation, price should meet resistance in the 1.1130 region, the level of the 38.2% swing high retracement.
Chief Technical Strategist
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