USDCHF—drop

My long from 1.0528 stopped out at breakeven as it encountered the tough 1.06 to 1.0675 resistance zone. I took partial profits at +60 pips as it climbed to its high of 1.0627 yesterday. In pulling back it has pierced its short-term uptrend line and RSI has also dropped below its uptrend line. The low so far has been 1.0499. I will probably attempt another long depending on momentum. What this means is that if it drops into oversold (below 30 RSI) on the hourly chart, I want to study its behavior there and as it rises above 30. If it looks as though its basing around the 30 RSI it will begin to look attractive to buyers.

Support is at 1.0486, 1.0461, 1.0376 and 1.0322. Resistance is at 1.0627, 1.0661/75, 1.0757, 1.0856 and 1.1138.

Here's the one-hour chart:












© Dianne Fecteau, 2010. No part of this material may be reproduced in any form, or referred to in any other publication, without the express written permission of the author.

My purpose in writing this blog is to show you how one trader, me, makes trading decisions and survives while trading Forex. One of the biggest problems I had when I first started trading was trying to apply the “rules” to actual trades. Another was the psychology—limiting losses and letting profits run. If you study my blog, you’ll see how I deal with both those issues. So my writings are not trade recommendations but rather educational in purpose. You have to decide on your own approach to trading. Remember that trading is risky.