USD/CHF Price Forecast: Reaches overbought levels

USD/CHF is in a strong uptrend which keeps making higher highs.
However it has reached overbought levels according to the RSI momentum indicator
This means bulls should be aware of the increased risk of pullbacks.

Joaquin Monfort FXStreet

USD/CHF continues rising in its established uptrend but it has now reached overbought levels (above 70) according to the Relative Strength Index (RSI) momentum indicator. When this occurs it advises long-holders not to add to their positions because of the increased risk of a pullback developing.

USD/CHF Daily Chart

According to technical analysis theory “the trend is your friend” which means it is better to trade in the direction of the dominant trend. As such, the odds favor more upside for USD/CHF. The RSI could continue to remain overbought or fall back into neutral territory first as the price pulls back.

The pair has now surpassed the target at 0.8873 (July 30 swing high) and is on its way to the next target at 0.9050 (July 2 swing high). Another possible target is 0.9000 due to its significance as a round-number and psychological level.

Author

Joaquin Monfort

FXStreet

Joaquin Monfort is a financial writer and analyst with over 10 years experience writing about financial markets and alt data. He holds a degree in Anthropology from London University and a Diploma in Technical analysis.

EUR/USD trims losses, back to 1.1830

EUR/USD manages to regain some composure, leaving behind part of the earlier losses and reclaim the 1.1830 region on Tuesday. In the meantime, the US Dollar’s upside impulse loses some momentum while investors remain cautious ahead of upcoming US data releases, including the FOMC Minutes.

GBP/USD bounces off lows, retargets 1.3550

After bottoming out just below the 1.3500 yardstick, GBP/USD now gathers some fresh bids and advances to the 1.3530-1.3540 band in the latter part of Tuesday’s session. Cable’s recovery comes as the Greenback surrenders part of its advance, although it keeps the bullish bias well in place for the day.

Gold remains offered below $5,000

Gold stays on the defensive on Tuesday, receding to the sub-$5,000 region per troy ounce on the back of the persistent move higher in the Greenback. The precious metal’s decline is also underpinned by the modest uptick in US Treasury yields across the spectrum.

Crypto Today: Bitcoin, Ethereum, XRP upside looks limited amid deteriorating retail demand

The cryptocurrency market extends weakness with major coins including Bitcoin (BTC), Ethereum (ETH) and Ripple (XRP) trading in sideways price action at the time of writing on Tuesday.

UK jobs market weakens, bolstering rate cut hopes

In the UK, the latest jobs report made for difficult reading. Nonetheless, this represents yet another reminder for the Bank of England that they need to act swiftly given the collapse in inflation expected over the coming months.

Ripple slides to $1.45 as downside risks surge

Ripple edges lower at the time of writing on Tuesday, from the daily open of $1.48, as headwinds persist across the crypto market. A short-term support is emerging at $1.45, but a buildup of bearish positions could further weaken the derivatives market and prolong the correction.