The USDCHF pair has recently encountered a crucial juncture, as it faces the support of the rising trend line on the 4-hour chart. This technical formation has been a key driver of the pair’s uptrend, which originated from the 0.8729 level.
Consolidation or Continuation?
As the pair navigates through this phase, traders will be closely monitoring the trend line support. As long as this crucial level holds firm, the pullback from the 0.9094 mark could be treated as a consolidation phase within the broader uptrend.
If the trend line support remains intact, further upside potential towards the 0.9150 area is still possible after the current consolidation phase.
Resistance Levels and Potential Breakout
While the consolidation phase unfolds, traders will be keeping a watchful eye on the initial resistance level at 0.9070. A decisive break above this level could potentially trigger further upside momentum, propelling the pair towards its previous high of 0.9094.
A convincing breach of the 0.9094 level would open the path towards the 0.9150 area, potentially reinforcing the strength of the broader uptrend.
Key Support and Potential Reversal
However, the technical landscape is not without its risks. A key support level is located at 0.8997. A breakdown below this level would indicate that the uptrend from 0.8729 has potentially completed at the 0.9094 level, signaling a potential shift in the pair’s trajectory.
In such a scenario, the next target for the bears would be the 0.8965 level, followed by the 0.8920 area, potentially marking a more significant correction or a reversal of the broader uptrend.
Key Levels to Watch
In this volatile phase, traders will be keeping a close eye on the following key levels:
- Rising trend line (current support)
- 0.9070 (initial resistance)
- 0.9094 (previous high resistance)
- 0.9150 (potential upside target)
- 0.8997 (key support)
- 0.8965 (potential downside target)
- 0.8920 (additional downside target)
The price action around these levels will be instrumental in determining the pair’s next move and the potential for a continuation of the uptrend, a consolidation phase, or a potential reversal.