Today on USDCHF – Daily and H4 charts support Short trades, but…

On the Daily chart above, the overall downward trend of this pair is pretty much obvious. Currently, price is within a narrow downward or bearish channel. It hit the upper edge of the bearish channel late last month (or late last week), and since then, it has reversed downward. We anticipate further bearish movement toward the lower edge of the narrow bearish channel; although we would expect price to meet some hurdles around the most recent Daily swing low – the current year-low @ 0.9915 (which we’ve highlighted using the blue broken line). From a day-trade perspective, our bias is bearish, however, we would like to see price break below the previous day’s low @ 0.9969 (not highlighted) before seeking our Hourly short trade setups – supported by the H4 chart.

On the H4 chart above, price broke the, at that time, most recent swing low @ 0.9992 (which we’ve highlighted using the uppermost blue broken line) downward. That automatically shifted our bias in favor of a downward price move. As discussed on the Daily chart, before seeking Hourly Short trade setups, we would like to see price break below the previous day’s low – also the most recent swing low @ 0.9969 (which we’ve highlighted using the middle blue broken line). The critical support level – the current year-low @ 0.9915 (that we’ve highlighted using the lowest blue broken line), which we also discussed on the Daily chart, is seen on the H4 chart. We have about a 50-pip gap between the previous day’s low and the year-low @ 0.9969 and 0.9915, respectively. From a day-trade perspective, the 50-pip gap is fairly a moderate distance, allowing us to seek Hourly Short trades.
The white horizontal line @ 1.0073 highlights the most recent swing high, and as long as price stays below it – in the absence of any new and lower swing high – our bearish or downward bias remains intact.

However, we still need our Hourly charts – using Fibonacci retracement levels and important resistance levels – to seek promising areas to take our Short positions. Price pattern on the Hourly must also be forming lower highs and lower lows. Please note that our aim is to sell a rally in today’s down-trend.

Also, PATIENCE is the key here: we need to patiently wait for the Hourly retracement. It might happen, and it might not.