From the beginning of November 2022 until the end of January this year, the USDCHF – USD – swiss franc pair moved in a downward trend. Initially, we recorded sharp declines but since mid-November the price has been falling less intensively, forming a downward channel ( blue dashed lines) of a height of about 300p.
In mid-February there was an upward breakout from this channel and the price formed an upward channel (red dashed lines). Currently, the price is about halfway up the channel with a downward trend towards its support. The declining MACD suggests declines at least to the aforementioned support, which is located at 0.9290, some 50p below the current price.
The H4 chart shows us the potential range of declines
On the H4 chart, the last two candles (at the time of writing) formed an inside bar formation. A breakout from the bottom of the formation may accelerate the movement towards the support of the upward channel in which the price has been moving since February this year.
If the price overcomes the support, the next target could be the demand zone starting at 0.9180, where we are dealing with the confluence point of support resulting from the intersection of the downward channel resistance and the demand zone. However, the possibility of a rebound from the uptrend channel support (red) as happened on 14 February should be taken into account.
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