CHF/JPY Could Be Set For Another Break Lower
Matt Simpson July 17, 2019 10:35 PM
Since its bull-trap at the start of the month, a lower high appears to have formed and the cross is now testing a potential breakout level.
Two weeks ago, we noted that CHF/JPY’s bull-trap and subsequent crash through key support had slammed it back onto our bearish watchlist. Sometimes it can take a little longer than you’d like to migrate from the watchlist to a trade (and sometimes it simply never happens), but it now appears CHF/JPY is preparing for its next dip lower.
Over the past week, five doji’s have formed below 110 (one being a bearish pinbar) and yesterday was its most bearish day in two weeks. The 100-day average has capped the recent swing high and, whilst the 50-day is acting as support, a clear break of 109.21 support invalidates it and takes it back within its original range.
As a quick re-cap to the prior analysis, CHF/JPY has been trending lower in a choppy fashion since the 118.067 high. We suspect we’re nearing the end of anything choppy, sideways correction.
- Near-term bias is for a break below 109.21, bringing the 108.22 low into focus.
- Should the bearish trend, it should also break beneath the 2017 low.
- A break back above 110 / 100-day MA invalidates the near-term, bearish bias.
Disclaimer: The information on this web site is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement. The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency or CFD contract. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. Any references to historical price movements or levels is informational based on our analysis and we do not represent or warranty that any such movements or levels are likely to reoccur in the future. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.
Futures, Options on Futures, Foreign Exchange and other leveraged products involves significant risk of loss and is not suitable for all investors. Losses can exceed your deposits. Increasing leverage increases risk. Spot Gold and Silver contracts are not subject to regulation under the U.S. Commodity Exchange Act. Contracts for Difference (CFDs) are not available for US residents. Before deciding to trade forex and commodity futures, you should carefully consider your financial objectives, level of experience and risk appetite. Any opinions, news, research, analyses, prices or other information contained herein is intended as general information about the subject matter covered and is provided with the understanding that we do not provide any investment, legal, or tax advice. You should consult with appropriate counsel or other advisors on all investment, legal, or tax matters. References to Forex.com or GAIN Capital refer to GAIN Capital Holdings Inc. and its subsidiaries. Please read Characteristics and Risks of Standardized Options.