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AUDCHF JULY 29TH 2014

USD/MXN 19.871 17:00 24.02
WELLS FARGO 57.525 17:00 24.02
USD/CHF 1.00555 17:00 24.02
OIL-APR17 (BRENT) 56.105 17:00 24.02
TOYOTA (US) 113.725 17:00 24.02
SONY 30.865 17:00 24.02
COLGATE-PALMOLIVE 73.005 17:00 24.02
FIAT CHRYSLER 10.74 17:00 24.02
LOCKHEED MARTIN 263.670 17:00 24.02
FERRARI 64.920 17:00 24.02
TSX 60 919.950 17:00 24.02
NZD/CHF 0.72402 17:00 24.02
CAD/CHF 0.76719 17:00 24.02
ALIBABA 102.105 17:00 24.02
BOEING 177.215 17:00 24.02
NZD/USD 0.72003 17:00 24.02
BANK OF AMERICA 24.145 17:00 24.02
CAD/JPY 85.655 17:00 24.02
AUD/USD 0.76799 17:00 24.02
AUD/JPY 86.220 17:00 24.02
GBP/USD 1.24984 17:00 24.02
EUR/USD 1.05800 17:00 24.02
GENERAL ELECTRIC 29.945 17:00 24.02
EUR/CHF 1.06391 17:00 24.02
S&P 500 2357.320 17:00 24.02
DOLLAR INDEX-MAR17 100.983 17:00 24.02
3M 186.885 17:00 24.02
CITIGROUP VS AIG 0.93773 17:00 24.02
CITIGROUP VS JP MORGAN CHASE 0.66142 17:00 24.02
MASTERCARD 110.390 17:00 24.02
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July 29th 2014 17:07pm GMT, London UK
 

  • – Currency Pair: AUDCHF
  • – Timeframe: H4 (Hourly Chart)
  • – Trading Recommendation: Seek short entry positions on rallies above 0.8505
  • – Take Profit Target: 0.8430 for a potential downward move of 75 pips
  • – Stop Loss: 0.8555 for a potential upward move of 40 pips

The AUDCHF has enjoyed a strong rally from an intra-day low of 0.8318 on July 3rd 2014. The rally has endured several smaller dips which set a series of higher lows and allowed the creation of an ascending support level which has not been violated since the rally started which took the AUDCHF to an intra-day high of 0.8548 on July 24th 2014. The rally which lasted sixteen trading days spanned 230 pips without a corrective phase.

AUDCHF

After reaching its latest intra-day high of 0.8548 the AUDCHF has entered a sideways trading pattern as forex traders await a new catalyst to move this currency pair away from its current levels. This sideways trend has created a resistance zone with a upper band of 0.8519 and a lower band of 0.8489. Price action is currently trapped inside this resistance zone as buyers stepped away and sellers have not entered the market yet.

There is no economic data which is scheduled for release during today’s trading session which would impact the Australian Dollar or the Swiss Franc which means forex traders can focus more on pure price action without the distraction of fundamental data known to spike the charts after the release and distort price action. The AUDCHF has been drifting towards the lower band of its resistance zone which could act as a weak support level and forex traders should monitor price action when it reaches the 0.8489 level.

Despite the lack of direct fundamental data which could impact the Australian Dollar and the Swiss Franc the following to factors should be taken into consideration:

Tension in Ukraine – There are no signs of receding tensions in the Ukraine and the Eurozone cold issue what is referred to as level three sanctions as soon as today. This could temporarily boost demand for the Swiss Franc and fuel the expected correction. Once price action breaks down below the 0.8489 mark forex traders may opt to take profits as well as add new short positions in order to take advantage of this Swiss Franc strength based on the safe haven currency status of the Swiss currency and not due to economic strength in Switzerland.

Chinese Recovery – Economic data out of China has been improving which has a positive impact on commodity currencies such as the Australian Dollar which explains the sixteen day rally the AUDCHF has enjoyed for 230 pips from an intra-day low to an intra-day high. Fallout from further sanctions could dampen the demand for the Australian currency in the short-term.

Given the above two scenarios forex traders should account for a correction from around current levels down to its ascending support level. The 0.8430 should be targeted for a take profit target as the headwinds for the Australian Dollar as well as the tailwinds for the Swiss Franc are expected to have a short-term impact on the AUDCHF. Any rally above current levels should be taken as a good entry opportunity into a short trade in order to take advantage of the brief correction which is expected in this currency pair before further analysis is required.

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Daniel Gant
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Daniel Gant

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My strategies have been maintained and reworked for the last four years. Win loss accuracy and a stable method of volume production has insured my clients inside my personal portfolio success, not to mention the education, guides and management sessions that I teach daily.

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