Don’t look now, but the CHF/JPY currency pair is right on a major area of interest on its daily time frame.
As you can see on the long-term chart below, the pair is testing a Fibonacci level, an uptrend line, and a previous resistance area.
Better keep your eye on these levels in case the uptrend remains intact!
CHF/JPY Daily Currency Pair Chart by TradingView
The franc bulls (or yen bears) appear to be defending a strong support area, as a long, wicked candle formed once the price tested the area of interest.
After all, this is near the 61.8% retracement level at the key psychological mark of 169.00, as well as S1 (167.35) at the uptrend line that has held since September of last year.
Can CHF/JPY bounce back from here?
Remember that directional biases and volatility in market prices are usually driven by fundamental factors. If you haven’t done your homework on the Swiss Franc and Japanese Yen yet, it’s time to take a look at the economic calendar and stay up to date with the daily fundamental news!
The 100 SMA is above the 200 SMA indicating that the path of least resistance is up or that the upside is more likely to gain momentum than reverse. Just be careful because the CHF/JPY pair has fallen below both moving averages, so these levels may remain as dynamic resistance levels in the future.
Sustained bullish momentum past these short-term barriers and the pivot point level (173.70) could take the pair all the way to the swing high near R1 (177.16) and beyond, so watch for long green candles that could attract more buyers.
On the flip side, stay alert for a continuation of the decline below the trend line, as this could pave the way for a move towards the next downside targets at S2 (163.95) and then S3 (157.58) depending on the next set of market catalysts.