- The US dollar has rallied initially during the trading session here on Thursday against the Swiss franc, touching the crucial 50-day EMA.
- That being said, we have seen the market turn around and show signs of hesitation.
- It looks like the 0.80 level looks likely, as it is going to act as resistance. This is a large, round, psychologically significant figure that a lot of people will be watching.
And with that being the case, I think it makes a certain amount of sense that we have pulled back. If we can break above the 0.80 level, then we could open up the possibility of a move to the 0.81 level. The 0.81 level, of course, being broken to the other side opens up the possibility of a move to the 200-day EMA.
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Shooting Star for the Day
The candlestick is a bit of a shooting star, so it does suggest that perhaps we pull back a bit. And this will be an interesting pair to watch because the U.S. dollar, of course, is considered to be a safety currency, but the Swiss franc is even more so. In other words, we have a lot of the same type of noisy factors coming into these currencies. Now that we have broken above the previous downtrend line, the question is, can we have any momentum?
If we break above that 0.81 level, I suspect that at that point in time, we will end up with a positive trend. If we break down below the 0.7850 level, the bottom could fall out. I think more likely than not, though, we probably see some sideways action in this general vicinity. So, if you're a short-term trader, that might be a good thing to take advantage of.
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