GBPCHF Breaks Important Support
August 24, 2015 in Chart Alert
GBP/CHF broke below the support of the upper edge of daily Ichimoku cloud today. This move certainly makes the near term bearish sentiments stronger and overall we expect further pull back towards downside.
However, a couple of points to be kept in mind are as follows:
- The fall from 1.5411 can be attributed to the psychological resistance of the approaching 1.5500 level and hence can be considered as a natural move.
- The current price is near the 38.2% retracement support of the move from 1.3818. This support, which was at 1.4802 was skightly breached but a decisive breakout has still not taken place.
- The current price is also slightly above the previous strong support on 1.4791.
Any decisive break below 1.4791 should extend the fall, first towards 1.4660 and then possibly 1.4614/1.4620 support zone of the 50% retracement support zone. Here the psychological support of the approaching 1.4500 ranges should also come into the picture.
On the upside, we expect the first resistance at or below 1.4920. Any break of this resistance should delay any further fall. However, in such case also, we would expect any recovery to be limited to 1.5125.