USD CHF Now Top Of Watchlist For Potential Swing Short

USD CHF Now Top Of Watchlist For Potential Swing Short

USD:CHF has moved itself back onto my radar taking no.1 slot on my watchlist!

No guarantee of this yielding a short entry but I’d rather post it ahead of an entry than after a potential move has already started.

4 hourly hit resistance today, but what I really liked about it was how the candle wick extended beyond resistance to tag the 200MA and simultaneously test the price level (defined by the blue line) where the previous channel got broken. It’s amazing how many traders are unaware of this, but it’s common for the price level of a trend line or channel break to become future resistance or support.

Further to this, we have additional confirmation of resistance through the rejection of price from the 50% Fib retrace.

It’s hard to make a confident call on any currency that’s linked to the Euro in one way or another because of the current Euro situation, however, if price starts rolling over from this resistance I’ll be looking for a short entry ahead of a deeper pull back.

If price breaks through and we see  2 consecutive green 4 hourly closes above this resistance level, I’ll scrap the whole swing short idea. Certainly one to keep an eye on intraday during Thursday’s trading.

5 Comments
  • RS2OOO
    Posted at 22:15h, 02 November

    I entered short this morning and was soon showing a profit, however, even now, there is something I’m not sure about this trade and can’t quite put my finger on why.

    As I was unable to screen watch around FOMC release I chose to protect myself with trailing stop and was stopped out for a 12 pip profit.

    I re-entered the position this evening at 0.8846 with wider stops, still not overly confident with it, so will see how it looks tomorrow and decide whether I want to run it or close it.

    • rhubarb
      Posted at 18:57h, 05 November

      I wonder if this chart, lifted from forexlive, messed up your short.

      http://www.forexlive.com/blog/2011/11/03/great-spot-for-a-eurchf-long/

      I went long EUR/CHF on the strength of it and made good pips
      .
      I particularly like the quote from SNB`s JP Danthine, “Even at a rate of 1.20 francs per euro, the franc remains high. “It should continue to weaken over time. If the economic outlook and deflationary risks so require, further measures will be taken,”

      I`ll be looking to buy more pullbacks.

      (Is there any copywrite problem me sending you quotes from other sites?)

  • RS2OOO
    Posted at 19:31h, 04 November

    I gave up on this swing short today.

    I didn’t feel comfortable with the position from the outset (though I rarely do in the early stages).

    One minute I’d have a look intraday and the position would be -50 points and looking bullish, a couple of hours later it would be +70 and looking bearish.

    Then, last night (19:30 GMT) price was simultaneously sitting on:

    A line I drew as support (Can’t remember how I calculated it)
    The hourly 200MA
    The 4 hourly 50MA
    The 50% fib retrace from the October 27th Low to the 1st November high.

    I considered closing the position at that point, but eventually chose to stick to the rules and rely on the original longer term analysis that got me into the trade.

    In the event, I decided today that if it broke past breakeven one more time I’d close…. It did, and I closed for -4 pips. Tried to get breakeven but was too slow, making this the first losing swing trade since blog inception!

  • Weekly Swing Trading Round Up 4th November 2011
    Posted at 00:38h, 05 November

    […] are occurring intraday on your chosen swing trade. USD:CHF was a wild ride this week following my swing short entry that was based on solid TA, but I just couldn’t get comfortable in the trade as gut feeling […]

  • RS2OOO
    Posted at 23:19h, 05 November

    Hi rhubarb,

    I think those intraday supports detailed in my above comment were simply stronger than I had given them credit for. I mean, there are 4 solid technical reasons there to take a long position, and that’s what other traders did.

    However, I think that link you refer to could well have been a catalyst.

    It’s still possible that the trade will work out as I originally expected as my stop was above the previous swing high and price is yet to print a higher high. But I respect my gut feeling, and in this case my feelings were that the trade was wrong.

    No problem with posting links – Most sites love the extra traffic and sometimes reciprocate by linking back to here.