10 days in the barn
The EURCHF left the barn today. For the last 10 trading days (see hourly chart below), the pair has been between the 1.0962 to 1.1015. ON the topside the extreme area was from 1.1008-1.1015. Note on the hourly chart below how the last corrective low today bottomed just above the 1.1008 level and it was a race higher (outside the barn) from there.
ON the downside, the horse...err EURCHF.... tried on 3 separate occasions to get out of the barn below 1.0962 over the last 5 trading days BUT each failed.
So what next?
Looking at the daily chart, the pair is up testing a target level at the 1.1049 level. The swing high from September 11, 2015 (highest high in 2015 sans the pre-SNB depegging) comes at that level. We moved above that peak on January 26th but were trading back below by Feb 9th (there was some small peeks above later in Feb but each failed quickly). Needless to say...this is a key level to get to and through (and stay above) if the break is to continue higher.
The longs on the break from earlier today have a decision to make but it is a good one. Sell and take profit against the level. If the price goes above, get back in. If it comes down, buy a dip. Do you put on a short here? You could the risk is on a break. So it is limited. But would expect that on dips, there will be buyers. So it is just a short term counter trade (from the vantage point right now).
KEY TARGET. KEY TEST. Risk is defined and limited.
