Talking Points
- USDCHF focus shifts higher after rebounding off support/weekly opening range breach
- Scalp bias bullish above the 90-figure,
- Broader outlook constructive above 8935- bullish invalidation
USDCHF Daily Chart
![Forex_USDCHF_Defends_January_Range_Low-_Scalp_Bias_Bullish_Above_90_body_USDCHF_Daily.png, USDCHF Defends January Range Low- Scalp Bias Bullish Above 90](http://media.dailyfx.com/illustrations/2014/01/30/Forex_USDCHF_Defends_January_Range_Low-_Scalp_Bias_Bullish_Above_90_body_USDCHF_Daily.png)
Chart Created Using FXCM Marketscope 2.0
Broader Technical Outlook
- USDCHF Breaks weekly ORH after rebounding off the 61.8% retracement
- Note RSI support hold above 40 & 50 breach - bullish
- Interim resistance 9041/59- Breach targets objectives at 9107/22 & 9188/98
- Scalp bias bullish above 90-handle / Broader bias constructive above 8935
- Event Risk: US Personal Income/Spending & University of Michigan Confidence Tomorrow
USDCHF Scalp Chart
![Forex_USDCHF_Defends_January_Range_Low-_Scalp_Bias_Bullish_Above_90_body_USDCHF_Scalp.png, USDCHF Defends January Range Low- Scalp Bias Bullish Above 90](http://media.dailyfx.com/illustrations/2014/01/30/Forex_USDCHF_Defends_January_Range_Low-_Scalp_Bias_Bullish_Above_90_body_USDCHF_Scalp.png)
Notes: The USDCHF has made an impressive rebound off Fibonacci support after defending the January opening range low late last week. Although the pair invalidated our setup last week with a break below 9080, a topside breach of this week's opening range high warrants long exposure and our immediate focus remains weighted to the topside while above the 90-handle.
That said, the pair has now come up against interim resistance at 9040/58 which is defined by the 100% extension taken form the advance off last week’s low, the 100-day moving average, trendline resistance and the 61.8% retracement of the decline off the monthly high. A breach above this threshold offers further conviction on our directional bias with such a scenario eyeing subsequent topside resistance targets.
Bottom line: We’ll look to buys dips/breaks of resistance while above 90 with only a break below last week’s close low at 8935 (also the 61.8% retracement) invalidating the our broader outlook and targeting the key support zone between 8860/88. Note that the daily momentum signature made a clean rebound off the 40-threhsold, suggesting that the recent decline off the monthly highs remains corrective in nature. Follow the progress of this trade setup and more throughout the trading week in DailyFX on Demand.
* It’s extremely important to give added consideration regarding the timing of intra-day scalps with the opening ranges on a session & hourly basis offering further clarity on intra-day biases.
Key Threshold Grid
Entry/Exit Targets | Timeframe | Level | Significance |
Bearish Invalidation | Daily / 30min | 9041/59 | 100% Ext / 61.8% Retrace / 100DMA |
Break Target 1 | Daily / 30min | 9077/83 | 61.8% Retracement / Last Week’s ORL |
Break Target 2 | Daily / 30min | 9107 | 1.618% Fibonacci Ext |
Break Target 3 | 30min | 9130 | Soft Resistance / Pivot |
Break Target 4 | 30min | 9153 | 78.6% Retracement |
Break Target 5 | Daily / 30min | 9188/98 | 38.2% & 88.6% Retrace / 11/20 Weekly High |
Break Target 6 | Daily | 9222 | 200DMA |
Break Target 7 | Daily | 9259 | 100% Fibonacci Extension |
Bullish Invalidation | 30min | 8998- 9009 | Weekly ORH / 61.8% Ext / 38.2% Retrace |
Break Target 1 | 30min | 8962 | 23.6% Retracement |
Break Target 2 | Daily / 30min | 8935 | 61.8% Ext / Wkly ORL / Last Wk’s Close Low |
Break Target 3 | 30min | 8902 | Monthly ORL / Last Week’s Low |
Break Target 4 | Daily / 30min | 8875/88 | 100% & 78.6% Exts / October Low |
Average True Range | Daily (20) | 72 | Profit Targets 17-19pips |
*ORH: Opening Range High
*ORL: Opening Range Low
Other Setups in Play:
- FOMC Setups - EUR, CAD, Gold Eye Key Dollar Inflection Points
- CADJPY Scalps Favor Selling Rallies Post Key Support Break
- USDCHF Scalp Setup Eyes Channel Support- Bullish Above 9080
- EURUSD Bias At Risk Above 1.3522- Weekly Opening Range in Focus
---Written by Michael Boutros, Currency Strategist with DailyFX
For updates on this scalp and more setups follow him on Twitter @MBForex
To contact Michael email mboutros@dailyfx.com or Click Here to be added to his email distribution list
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Interested in learning about Fibonacci? Watch this Video
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