Who’s down for some simple range plays today?
I’m seeing a couple of franc pairs testing their short-term support levels right now!
Here are the inflection points I’m watching on NZD/CHF and AUD/CHF:
This one’s hanging out right at the bottom of its short-term range again!
Support around the .5920 area seems to be holding so far, as NZD/CHF might be poised to make a teeny-tiny double bottom pattern to signal that a rally is underway.If that happens, price could make its way back up to the top of the range at the .6000 major psychological mark.
Technical indicators are giving mixed signals, though. While Stochastic is on the move up to reflect bullish vibes, the 100 SMA is attempting a bearish crossover from the 200 SMA.
If you’re bearish on this pair, you could wait for the moving average crossover to be completed and for Stochastic to indicate overbought conditions before shorting on a breakdown.
I wouldn’t want to miss a chance to catch a 100-pip drop in case that happens!
Now this AUD/CHF range keeps on giving!
If you’ve missed any of those support and resistance bounces, you gotta pay closer attention to this ongoing test.The pair is already down to the range bottom at the .6600 major psychological mark, still deciding whether to make a bounce or a break.
Stochastic is hinting that the floor is likely to hold, as the oscillator is reflecting oversold conditions. Turning higher would mean that Aussie bulls are back in action and could take AUD/CHF back up to the top at .6715.
However, 100 SMA is still below the 200 SMA to indicate selling pressure. At the same time, the pair is trading below both moving averages, so these could hold as dynamic resistance around the middle of the range.
Don’t forget that a break lower is possible, too, and that this might result in a drop that’s the same height as the rectangle pattern.
Whichever pair and direction you choose to trade, always remember to practice proper risk management!