USD/CHF Tests Critical Support Amid Persistent Selling Pressure

Today’s focus is on the American dollar to Swiss franc (USD/CHF), which is currently testing a critical horizontal support level, marked in yellow. The sentiment remains negative, continuing the bearish trend that began on February 12th. Since then, the price has dropped significantly, and after a brief consolidation, it formed a flag pattern marked in orange. This flag is a trend continuation pattern, and as anticipated, it broke to the downside yesterday, leading the price to retest the key yellow support.

What’s important to note is that in previous encounters with this support, the price experienced sharp and energetic reversals. However, this time, the selling pressure is more persistent, as the price has remained close to the support level for several hours, suggesting a potential breakdown.

Trading Scenarios:

• A daily close below the yellow support would confirm a breakdown, generating a strong sell signal, and likely leading to further downside movement.
• Conversely, a bounce off this support level would indicate a successful defense by the bulls, creating an opportunity to go long.

Given the current price action and persistent selling pressure, the chances of a bearish breakout are increasing. However, traders should remain cautious and watch for confirmation before entering new positions.

Source: https://www.axiory.com/analytics/technical-analysis/usd-chf-tests-critical-support-amid-persistent-sel