The following commentary comes from an independent investor or market observer as part of TheStreet's guest contributor program, which is separate from the company's news coverage.
NEW YORK (
) -- With the pound-Swiss franc (GBP-CHF) cross currency pair following through higher on its hammer-candle pattern this past week, further corrective recovery gains are likely in the coming week.
The past week's developments come on the back of a halt in the pound-Swiss franc's broader weakness at 1.1465 in early August and its subsequent recovery.
Resistance in a further recovery lies at the 1.3435 level, the cross currency pair's July 22 high, with a violation of that level allowing for further strength toward 1.3584, the pair's July 8 high.
Further out, resistance comes in at 1.3695 level, GBP-CHF's July 4 high.
The pair's weekly relative strength index is bullish and pointing higher, suggesting further strength.
Alternatively, a break and hold below the 1.1465 level will reverse the pound-Swiss franc's corrective strength and set the stage for a run at 1.1400. A breach of that level would pave the way for a push even lower, toward the 1.1300 and 1.1200 psychological levels.
Overall, although GBP-CHF remains broadly biased to the downside in the long term, it is likely to see further corrective recovery in the near term.
-- Written by Mohammed Isah
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Mohammed Isah is a technical strategist and head of research at FXTechstrategy.com, a technical-research Web site. He has been trading and analyzing the foreign exchange market for the past seven years. He formerly traded stocks before crossing over to the forex market, where he worked for FXInstructor LLC as a technical analyst and head of research before joining FXTechstrategy.com. He has written extensively on the forex market and technical analysis and his articles have been featured in The Technical Analyst Magazine, The Forex Journal Magazine, The International Business Times and FXstreet.com. At FXTechstrategy.com, he writes daily, weekly and long-term technical commentaries on currencies and commodities, which are offered to its clients. He also produces
for his subscribers. He provides full coverage of the forex market with specific focus on G10 currencies as well as the commodities markets, with focus on five key commodities.