Long Trade Idea
- Long entry after a bullish price action reversal on the H1 timeframe following the next touch of $0.8198 or $0.8158.
- Put the stop loss 15 pips below the local swing low.
- Move the stop loss to break even once the trade is 15 pips in profit by price.
- Remove 50% of the position as profit when the trade is 15 pips in profit by price and leave the remainder of the position to ride.
Short Trade Ideas
- Short entry after a bearish price action reversal on the H1 timeframe following the next touch of $0.8284 or $0.8333.
- Put the stop loss 20 pips above the local swing high.
- Move the stop loss to break even once the trade is 20 pips in profit by price.
- Remove 50% of the position as profit when the trade is 20 pips in profit by price and leave the remainder of the position to ride.
The best method to identify a classic “price action reversal” is for an hourly candle to close, such as a pin bar, a doji, an outside or even just an engulfing candle with a higher close. You can exploit these levels or zones by watching the price action that occurs at the given levels.
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USD/CHF Analysis
The USD/CHF currency pair has made some big price swings over the past year, with the US Dollar recently in a strong bearish trend while risk-off sentiment helped boost the Swissy.
The price recently touched a multi-year low not far from the massive round number at $0.8000 just two weeks ago but has rebounded from there as the recovery in risk appetite got fully underway after the US tariffs issue was swept under the carpet until we approach the July deadline.
The last couple of weeks have seen this recovery peter out into a flat consolidation between $0.8200 and $0.8333. I expect this consolidation pattern to hold today, as markets are quiet, there are no major news drivers, Forex is in a low-volatility regime, and we await the major event of the US Federal Reserve policy meeting tomorrow.
As I expect this consolidation to hold, the best trading strategy for this currency pair today will be to play this range, so I will be happy with either a long from $0.8200 or a short from $0.8333. Even a short from $0.8284 could be an OK trade, just be more conservative with a profit target in that case.
A breakout from this range is likely to happen by the end of this week, at some point after tomorrow’s New York session.
There is nothing of high importance due today regarding either the Swiss Franc or the US Dollar.
Ready to trade our USD/CHF forecast? Here’s our list of the best Forex brokers in Switzerland worth checking out.