Bounces off the 200 day MA earlier today
The USDCHF is currently trading at the highs for the day and continues the correction recovery from the de-peg plunge. Discounting the sharp fall, the pair trades at levels from October 2014.
The pair got a boost yesterday on the back of comments from SNB Jordan who bemoaned the overvaluation of the CHF once again, and threatened intervention. His words - and the proximity of the pair to the 200 day MA (green line in the chart above) - helped push the price away from that key level.
In trading today, there was a phantom drop in the far east session that saw the price move 40 pips lower in less than 10 minutes (see 5 minute chart below). That fall bottomed at the 0.9314 level - 7 pips short of the 200 day MA at 0.9307 today. Buyers forced the price back higher - recovering the full decline in the next 15 minutes. From that point, the momentum higher continued in a steady trend move to the upside.
Looking at the daily chart the price is testing the lows from October 2014 at the 0.9441-44 area. The high today is 0.9446 currently. On the 5 minute chart, the price is also testing (trying to extend above) the topside channel trend line. This area will be eyed for potential selling interest. The price levels have been broken on both the daily and the 5 minute chart but so far, the momentum is not showing up. So I am on alert for a failure that perhaps signals the high is in place for the day. So far, however, the buyers are remaining in control.
Even so, any back fill should be limited with the 0.9435 as a level that would need to be breached below to signal a potential further decline (see 5 minute chart above).
