USDCHF Above Thin Ichimoku – Forex Trading Strategy

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USDCHF Above Thin Ichimoku – Forex Trading Strategy

USDCHF Above Thin Ichimoku

What’s an Invest Diva to do when USDCHF above thin Ichimoku cloud is making tiny little movements? The good news is, there might be some hidden trading opportunities. Read on for an IDDA appraoch to forex trading strategy development.

USDCHF Above Thin Ichimoku – Kiana Danial with Orbex

Technical Analysis | USDCHF Above Thin Ichimoku

After the Swiss bank jaw-boning on January 15th, 2015, the USDCHF pair has gone back to its range habit of the past. However in the recent months, the range appears to have gotten thinner and thinner.

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Dancing within a long term Triangle, the pair has been breaking above and below the Ichimoku cloud since April 2016, remaining mainly between the median ranges of 0.9850 and 0.9550. On Tuesday’s Sydney session, USDCHF above thin Ichimoku cloud opened the trading the day and tested around the upper band of the cloud on the daily chart.

USDCHF Above Thin Ichimoku – Technical Analysis

Fundamental Analysis | USDCHF Above Thin Ichimoku

US Economic Data: Monday and first day of October trading certainly boosted Ms. USA off the bat. The higher than expected ISM manufacturing PMI reading for September was the main story for the New York session, as the figure indicated a return to industry expansion. The figure rose from 49.4 to 51.5, outpacing the previous reading of 50.4.

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Meanwhile, Fed official Mester said that the Fed is making progress in achieving its goals and that a gradual path in tightening is possible. She added higher interest rates won’t worsen the situation among European banks. Damn! Good stuff for Ms. USA, eh?

Swiss Economic Data: Mr. Swissy started getting its butt kicked on final trading day of September, as there were rumors going around speculating that the SNB was intervening to weaken Mr. Swissy.

The butt kicking continued as the Swiss retail sales came in worse than the -2.7% expected, releasing red figure of -3.0%.

It seems the pair is actually paying attention to the fundamental data… So we may need to pay closer attention to the upcoming data. What do you think?

Coming up…

  • Swiss Consumer Price Index – Thursday October 6
  • US Purchasing Managers Index – Wednesday October 5
  • US Unemployment Rate – Friday October 7
  • Swiss  Unemployment Rate – Monday October 10

Market Sentiment | USDCHF Above Thin Ichimoku

Well here comes the issue with our bullish outlook so far: 70% of traders are long the USD/CHF pair according to the SSI. Since we use such sentiment analysis as a contrarian indicator, this unfortunately is giving us further bearish signal.

Trading Strategy | USDCHF Above Thin Ichimoku

Bullish Scenario:

So we’ve got 2 points of IDDA signaling further up-moves, while the final point signals bearish movements.

With that, we conclude a weak bullish signal only for traders with high risk tolerance for short-term trades.

Medium and long term trader could target 0.98 and 0.9850 respectively on better than expected US economic data.

STEP ONE: You need to first calculate your risk appetite as well as risk tolerance before picking your target.

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Bearish Scenario:

If the pair doesn’t confirm above the Ichimoku cloud on Wednesday, our outlook could change to bearish for short-medium term trades.

Bearish targets are set at 0.97 and 0.9550

Here are Invest Diva’s calculations for important USD/USD  approximate levels to keep an eye on from a long-term perspective:

Support Levels Turning Point Resistance Levels
0.93 0.97 0.9850
0.9550 0.9750 1.00


Kiana 喜愛成
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