The USD/CHF technical analysis and trading recommendations for December 23, 2010
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Overview:
It seems that franc started downside movement. New sell signal with 0.9423 target leve has been formed. The signal is strong and confirmed, as the Chinkou Span managed to fixate below the price chart and the price fixed below the Ichimoku Cloud. Therefore, now the first target of the downside movement is the second support level 0.9408. In case this level is passed the next target will be the third support level of 0.9255. The downside movement remains until the price is below the Kijun-Sen (0.9610), if the price fixates above this line it is advisable to cut short positions. The Chinkou Span is below the price curve, thus indicating the bearish sentiment and confirming the sell signal. The Bollinger Bands seem to show the beginning of downside trend, the lines are diverging and directed down. The MACD is descending indicating the downward movement.
Trading recommendations:
Currently it is recommended to trade down with the target to 0.9408, in case this level is passed the next target will be 0.9255. Stop Loss should be placed above the Kijun-Sen (0.9610). In case the MACD reverses up short positions should be cut manually.
In addition to technical image, one should take into account the fundamental data and the time of their release.
The chart annotation:
Ichimoku indicator:
Tenkan-sen red line
Kijun-Sen blue line
Senkou Span A light brown stipple line
Senkou Span B light purple stipple line
Chinkou Span green line
Bollinger Bands indicator:
3 yellow lines
MACD indicator:
The red line and the histogram with the white bars in the indicators window.
Performed by Stanislav Polyanskiy, Analytical expert
InstaForex Companies Group © 2007-2010
More analysis - at instaforex.com
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Fundamental Analysis, December 23, 2010
The national office of statistics in Britain has announced yesterday that the country's GDP rose in the third quarter by 0.7% as compared to the second quarter. Growth had been more moderate than preliminary estimates of a 0.8% growth, as well as economists' predictions of a 0.8% increase. Europe's stock exchanges, having recovered all the declines they incurred due to the collapse of the American Lehman Brothers investment bank in 2008, had closed yesterday on a mixed trend, with the London exchange locking at a 0.6% rise, the Frankfurt exchange retreating by 0.1%, and Paris declining by 0.2%
A mixed trend with a tendency for index rises has been recorded this morning in the Asian stock markets, led by the stock of the commodities sector, after the price of oil approached 90 United States dollars per barrel of oil. The growth has also been influenced by the index rises recorded on Wall Street yesterday. Therefore, the Seoul stock exchange declines by 0.4%. The Hong Kong stock exchange climbs by 0.2%, and the Taiwan stock exchange strengthens by 0.2% as well. Due to a Japanese holiday, trade will not be conducted today at the Tokyo stock exchange.
In the macroeconomic sphere, the United States Department of Commerce reported yesterday that the American GDP grew in the third quarter at an annualized rate of 2.6%, higher growth than expected according to preliminary data published in the previous month, pointing to a 2.5% growth. That said, growth was more moderate than predicted by economists, who predicted a 2.9% growth in the third quarter.
More from the macroeconomic sphere: the real estate agents' association announce yesterday that existing home prices rose 5.6% in November as compare to the previous month, to an annualized rate of 4.68 million homes. Growth was slightly higher than analysts' predictions of an annualized rate of 4.66 million homes in November, as compared to an annualized rate of 4.43 million homes in October. Still, the sales rate is lower by 27.9% from the rate for November 2009.
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Performed by Gerardo Porras Palomino, Analytical expert
InstaForex Companies Group © 2007-2010
More analysis - at instaforex.com
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CHF/JPY, Signs of Reversing the Downward Trend, December 23, 2010 (Daily Strategy)
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CHF/JPY
The Swiss Frank Japanese Yen is beginning to show signs of tiredness over everything related to its bullish trend that had brought it yesterday to a new high around the strong resistance level of 88.00. The pair's failure to breach the resistance level, in combination with the negative deviation developing between the price movement and the MACD indicator, lead us to estimate that the pair is headed south.
A final confirmation for a trend reversal and a new wave of downwards movement will be received only after the pair breaches the bottom of the shuffle pattern it entered during last week, around 86.15. The first support level, expected to stall the negative momentum, should such a thing appear, will be poised around 84.15, while the meaningful support level around 82.15 will serve us as a final goal for a complete exit from the sell position.
Performed by Gerardo Porras Palomino, Analytical expert
InstaForex Companies Group © 2007-2010
More analysis - at instaforex.com