Takeaway

USD/CHF has pulled back approximately 2% from yearly highs following a recent U.S. CPI print, pushing daily momentum toward the bears as the RSI slips below 50. The presenter argues the pair is testing a critical pivot zone at 8208–8200; a breakdown below 8200 signals a deeper correction toward 8120, while bulls require a daily close above 8327 to reinstate the broader uptrend ahead of key U.S. data and the Federal Reserve rate decision.

What the presenter said

• USD/CHF snapped a seven-week winning streak following an outside weekly reversal off fresh yearly highs [00:00:13].
• The current pullback has extended roughly 2% off the high, testing an inflection point [00:00:38].
• The pair is nearing a pivotal zone between 8208 and 8200, which aligns the 23.6% retracement of the yearly advance, the 100% extension off yearly lows, the July swing high, and a median line [00:00:41].
• A break below 8208–8200 would suggest a more significant top is in place and open the door to a larger correction [00:01:08], with weekly momentum indicating a larger drop on a break of 82 [00:01:16].
• Daily chart resistance capped rallies in late September and early October at the upper parallel before CPI catalyzed the drop [00:01:40]; daily RSI has since dropped below 50 for the first time since August [00:02:31].
• Broader bullish invalidation sits at 8120–8124, a zone marked by the August high close, November highs, June high close, and the 61.8% retracement from August lows [00:02:20].
• On the 4-hour chart, initial resistance sits at 8285, which should cap rallies if the market is to push lower [00:03:04, 00:03:19].
• A daily close below 82 confirms deeper corrective downside toward the September opening range high at 8155 and the 8120–8124 support pocket [00:03:24, 00:03:29].
• Bullish continuation requires a daily close above 8327 (61.8% retracement), targeting resistance at 8375 and 8387 (161.8% extension off August lows) [00:03:10, 00:03:46].
• U.S. event risk dominates price action: markets price an 85% probability of a Fed hold at the October 27th/28th meeting [00:04:34] and an 89% probability of at least one 25 bps hike by December [00:04:42].

Trade ideas

• USD/CHF (Bearish Continuation / Correction):
  • Direction: Neutral (conditional short)
  • Entry/Target/Stop: Rallies capped at 8285 resistance; breakout confirmed on a close below 8200, targeting 8155 and 8120–8124.
  • Horizon: Short-term
  • Conviction: Medium
• USD/CHF (Uptrend Resumption):
  • Direction: Neutral (conditional long)
  • Entry/Target/Stop: Requires a daily close northbound of 8327; targets resistance at 8375 and 8387.
  • Horizon: Short-term
  • Conviction: Medium

Levels and data cited

Price Levels (USD/CHF): - 8387: Resistance (161.8% extension off August low) - 8375: Key resistance - 8327: Resistance (61.8% retracement; required close for uptrend resumption) - 8285: Initial resistance on 4-hour chart (ceiling for immediate bearish case) - 8208: Pivot (23.6% retracement of yearly range advance) - 8200: Major pivot (100% extension off yearly lows, July swing high, median line) - 8155: Downside support (September opening range highs) - 8120–8124: Support & broader bullish invalidation (August high close, prior November highs, June high day close, 61.8% retracement from August lows)

Data References: - U.S. CPI print (released previous week) - U.S. Manufacturing and Services PMI (due Friday, Oct 22nd) - Federal Reserve Rate Decision (Oct 27th/28th): 85% market probability of a hold - Federal Reserve Rate Decision (December): 89% probability of at least a 25 bps hike - U.S. Core PCE (due Thursday, Oct 28th)

Risks and what would invalidate this

• A break below 8208–8200 confirms that a meaningful high has formed, risking a deeper pullback.
• A break below 82 confirms the larger corrective sequence.
• A loss of 8120–8124 serves as broader bullish invalidation, indicating a major trend reversal.
• Failure to achieve a daily close above 8327 invalidates attempts to resume the broader uptrend.