Hello traders! Previously we have posted CHF/JPY analysis and I would like to share with you the outcome, which you can see above.
And now we will look at the current state of things on this pair. On a daily chart, price rejected the 23.6% Fibonacci retracement level applied to the Oct 2019 – Jan 2020 uptrend. The correctional move down this month resulted in price moving down and found the support area between 50% and 61.8% Fibonacci retracement level. But at the same time, there were no clean rejections of any of these support levels.
We should bring out attention perhaps to the break and close below the 200 Exponential Moving Average, which, along with 23.6% Fib rejection, suggesting a continuation of the decline.
Now let’s take a look at the 4-hour chart. We can see that 200 EMA was rejected multiple times together with the downtrend trendline.
This might be yet another confirmation of the bear market. As long as the price stays below the 112.57 level, we are likely to see more of a downtrend. Price is expected to drop towards 78.6% Fibonacci level at 111.17, which corresponds to the strong level of resistance formed back in November 2019.
Bias: Bearish while below 112.57
Potential Resistance Zone: 112.40-112.60
Potential Targets: 110.17
Have a profitable trading!