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Technical Report – March 13, 2013: USD/CHF Grinds through Long Term Resistance

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Chart of the Day: USD/CHF


USD/CHF: The US Dollar is pushing ahead with its long term uptrend against the Swiss Franc, and the latest moves in the pair suggest that there is little in the way to slow bullish momentum in the near term. Specifically, the major move was seen as prices rose above the psychological 95.00 level, as this area marked historical resistance as well as the 50% Fib retracement of the decline from 0.9970. For medium and short term traders, the resistance is very thin until we reach 96.10 (the 61.8% retracement of the same Fib move), so the pair remains a buy on dips. Support to the downside can be found at 0.9430.

EUR/JPY: The EUR/JPY pushed to new highs for the week (continuing the short term progress made during the strong Friday rally) and prices have now pushed through sell order situated at the 125.20 resistance level. This area was a major breakdown point previously, so this move is encouraging for the bullish prospects for the pair. Looking at the daily charts, the latest bull wave found support at the 23.6% Fib retracement of the rally from 93.90 (at 119.80), so longer term traders should pay special attention to this level going forward. A breakdown here would heavily damage the structure of the pair and suggest an extended period of weakness.

AUD/USD: The AUD/USD continues hold inside its symmetrical triangle on the weekly charts, but on the shorter term time frames, the prospects for the pair are starting to look more encouraging. Specifically, this means the upside break in the downtrend channel which began in the last week of January, so the focus is now on a test of topside resistance at 1.0370. A break here would be a very bullish event and suggest a longer term test of the declining resistance trendline that creates the symmetrical triangle on the weekly charts.

EUR/CHF: The EUR/CHF is showing some weakness after failing to overcome historical and Fib resistance in the 1.2390 region. We have been watching this area for some time, as the monthly bull trend will need to find a break here in order to generate fresh upside momentum. The pair remains a buy on dips, however, and the next suitable support level for long positions can be found at 1.2280.

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