In our webinar on Monday, we discussed the bullish outlook for the US dollar after US yields broke higher following the Fed rate hike on September 9. We looked at several currency pairs that could offer interesting opportunities on the long USD side, with a particular focus on USDCHF.
The Swiss National Bank is not as hawkish as some other major central banks. In fact, the SNB recently said that it remains willing to intervene in the FX market if the Swiss franc strengthens too much. This keeps us cautious on CHF, while on the other side we remain bullish on the US dollar, especially as the Fed has indicated that further rate hikes may still be needed.
In the webinar, we specifically highlighted the 0.8200 area. This was the August 5 high that had recently been broken, before USDCHF pulled back in three waves to retest that level. From a simple technical perspective, this can be viewed as previous resistance turning into support. However, when we combine this level with the Elliott Wave structure, it becomes even more interesting. The recovery from the lows is impulsive, while the pullback into 0.8200 was corrective, suggesting that the broader bullish trend could resume.
We were therefore looking for more upside in wave three and later another opportunity to catch wave five. As you can see on the charts below, USDCHF has already extended to new highs. The 0.8155–0.8200 yellow support zone provided a very nice reaction and was an important area to watch for potential bullish opportunities.
This is exactly why we use yellow boxes in our analysis. Sometimes Grega will share his own trades through our Trading Notes, but even when he does not personally take a trade, members can use these highlighted reversal zones to identify potential opportunities based on the Elliott Wave structure. Not every analysis will produce a trading opportunity, but some wave patterns are much clearer than others, and our goal is to highlight the setups with the strongest technical potential.
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