GBP/CHF skyrocketed again today, breaking above Friday’s high, which is near the 1.2200 zone, and then, overcoming the 1.2235 zone, which provided decent support to the price action between July 16th and 23rd. Following the break above the prior key resistance of 1.2075, the rate seems to have started printing higher peaks and higher troughs and thus, we would consider the near-term outlook to be positive for now.
If the bulls are willing to stay in the driver’s seat, we could see them pushing higher, perhaps aiming for the 1.2365 area, which is near the high of July 25th. They could decide to take a small break after testing that territory, thereby allowing the rate to correct back down. However, as long as GBP/CHF would be trading above the 1.2235 level, we would still see decent chances for another leg north. If this is the case, then another test near 1.2365 could be possible, and if the bulls manage to overcome that zone this time, we may see them putting the 1.2413 barrier on their radars, which is marked by the highs of July 11th and 12th.
Taking a look at our short-term oscillators, we see that the RSI, already above 50, has turned up and just crossed above its 70 line. The MACD lies within its positive territory and it just poked its nose above its trigger line. Both indicators detect strong upside speed and corroborate the case for the pair to continue climbing higher.
In order to totally abandon the bullish case, we would like to see a slide back below 1.2075. This would confirm a forthcoming lower low on the 4-hour chart and may encourage the bears to take charge and push towards an intraday swing low formed on September 4th, at around 1.1950. If that level is not able to halt the slide either, then we could experience extensions towards the low of September 3rd, near 1.1855.
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