• USDCHF edges lower today after a strong upleg 

• July 27 ascending trendline acts as resistance at this stage

• Momentum indicators point to weakening bullish pressure

USDCHF is edging lower today after nine consecutive green candles. A similar move took place during September and pushed USDCHF to a 6-month high of 0.9243. The July 27 ascending trendline acts as resistance at this stage, allowing the bulls to potentially take profit and some risk off the table ahead of Wednesday’s Fed meeting. Interestingly, the 50- and 200-day simple moving averages (SMAs) are converging and thus increasing the chances of a bullish golden cross occurring soon.

Turning to the momentum indicators and there appears to be strong, but somewhat weakening, support for the current bullish move. More specifically, the Average Directional Movement Index (ADX) is edging higher, signaling a decent bullish trend in USDCHF, and the RSI is trading a tad above its 50-midpoint. More importantly, the stochastic oscillator is steadily edging higher and gradually opening a gap from its moving average.

Should the bulls remain confident, they could try to keep USDCHF above the 0.9055-0.9071 range and overcome the July 27 upward sloping trendline. Higher, the February 16, 2018 low at 0.9187 is unlikely to trouble the bulls much, opening the door for a gradual move towards the busy 0.9288-0.9314 area.

On the other hand, the bears would try to defend the July 27 upward sloping trendline and quickly push USDCHF below the 0.9055-0.9071 region that is populated by the May 7, 2015 low and the 78.6% Fibonacci retracement of the January 6, 2021 – October 21, 2022 uptrend. Even lower, the 50- and 200-day SMAs at 0.9000 could prove a stronger support area than currently foreseen.

To sum up, USDCHF bulls are taking a step back ahead of Wednesday’s Fed meeting and in light of the resistance met at the July 27 ascending trendline.