AUD/CHF ‘bullish gartley’ pattern on AUD/CHF raises scope for upside, upside only on break above 0.74
- Swiss franc failed to benefit significantly from risk aversion across the markets.
- AUD/CHF recovered from 0.73 handle and closed just shy of 0.74 handle.
- The pair finds stiff resistance at 5-DMA and we see some upside only on close above.
- We evidence bullish divergence from price action on RSI and Stochs which raises scope for upside.
- Also, the pair has completed a ‘Bullish Gartley’ pattern on daily charts which adds to the bullish bias.
- Upside for now remains capped at 0.74 handle and we see breakout there to see further gains.
- On the flipside, the pair is trading below all major moving EMAs. Break below 0.73 handle will see resumption of weakness.
- We then see scope then for test of 0.7220 (88.6% Fib).
Support levels – 0.73 (psychological level), 0.7285 (78.6% Fib retrace of 0.7146 to 0.78 rally), 0.7220 (88.6% Fib)
Resistance levels – 0.7384 (5-DMA), 0.74 (psychological level), 0.7480 (1H 200-SMA)
Call update: Our previous call (https://www.econotimes.com/FxWirePro-AUD-CHF-slips-below-100W-SMA-at-07467-break-below-074-to-see-further-weakness-1130137) has hit all targets.
Recommendation: Good to go short around 0.7370, SL: 0.7425, TP: 0.73/ 0.7285/ 0.7220
Source: FXWire Technicals