During the trading session on Tuesday, October, 10, the US dollar is strongly going down against Swiss franc and stepped away from the local highs, renewed in the end of the last week. The instrument is falling due to the weak positions of the US currency against the decrease of the US bonds’ yield and anticipation of publication of FOMC Minutes on October, 11. In addition, the traders reacted negatively to the news that Trump’s Administration postponed the implementation of the tax reformation, which had been announced recently.
On the other hand, franc is supported by the strong employment market data publications: the unemployment level in Switzerland decreased from 3.2% to 3.1% in September, which was better than the analysts expected.
Support and resistance
On the daily chart Bollinger Bands are moderately growing. The price range is insignificantly narrowing, reflecting the flat trading mood of the recent days. It’s better to use the channel trading strategy.
MACD is going down, keeping a weak sell signal (the histogram is below the signal line). It’s better to keep opened short positions in the short term, but not to open new ones before additional signals appear.
Stochastic is going down, being in the center of its working area. The indicator’s readings don’t contradict with the development of the “bearish” dynamics in the short or very short term.
Resistance levels: 0.9767, 0.9800, 0.9834.
Support levels: 0.9732, 0.9707, 0.9677, 0.9650.
Long positions can be opened after the breakout of the level of 0.9800. Take profit is 0.9850–0.9880. Stop loss is 0.9760. Implementation period: 2–3 days.
The alternative is the return of the strong “bearish” trend with the breakdown of the level of 0.9732. The targets will be at the levels of 0.9677 or 0.9650. Stop loss is 0.9767. Implementation period: 2-3 days.