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Faraday: USD Swiss recovery offers opportunity

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Faraday analyst Alex Joyner talks us through his ideas for a USDCHF trade.

Alex says "Following the recent shock SNB decision, US Dollar/ Swiss Franc was one of the currency pairs which felt the full force of the turmoil. With a phenomenal drop of over one and a half thousand points on the day, many traders were caught short. 

Looking at the daily chart we can see that now the dust has settled, buyers have stepped back in causing a slight retracement higher. This has created a potential selling opportunity, which could allow us to join the strong downwards momentum. 

On the 4 hour chart, its clear this pull back up has occurred within in an ascending triangle formation. The price action is currently testing the top of this triangle around the 0.8800 major psychological level. 

This has held as resistance several times already and if we see a clear move lower from it today we would look to sell the pair. This should lead to a test of the triangle support down near the 0.8600 level and a subsequent break below this could result in an even bigger."