About Pick of the Day

Each day, I will try to find what I believe is the best looking short term trade setup for the upcoming trading day or week. If you're a forex newbie, it can be tricky in the beginning trying to figure out how to look at charts and draw lines. My goal is help you understand the psychology of price movements so you can learn to analyze your own charts and trade on your very own. I will post my ideas and/or reviews through out each session right here, on Twitter and on Facebook.

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Pick of the Day: USD/CHF

Posted 23:10 17 July 2006 | Comments

We've seen a strong rise in the US dollar recently, mostly due to the crisis in the Middle East, as traders rush to the greenback for safety. Now, as we look at the 1 hour chart on USD/CHF, it seems the US dollar has stalled in its rise, indicating it may be short term overbought. This is backed up by the stochastic indicator at the bottom currently in the overbought territory. I will be looking for a short term move to the downside as traders lighten up their positions to take profit. Before entering this trade, please be aware of US economic reports starting with Produce Price Index at 8:30 am EST and the TIC report at 9:00 pm EST. You may want to adjust positions to lock in any profit during that time period.

Short USD/CHF at 1.2455, stop at 1.2490, pt1 at 1.2435, pt2 at 1.2405

Good luck and good trading!