Monday saw the Swiss Franc losing strength against the Yen with the pair closing the day at 84.59. Price action on the lower timeframes didn’t provide any trading opportunities throughout the day; however, the daily candle closing as a bearish pin bar suggests further losses could be expected.
The bearish pin bar is further strengthened by strong resistance coming in at the 85.00 area. Towards the end of last week, the market did infact break and close above this important level, however was quickly reversed on Fridays trading and pushed even lower on Monday. The last time the area at 85.00 was tested back in November/December last year, the market struggled to break though and fell much lower suggesting the same could happen again.
The area at 85.00 can be seen in the chart below. It’s important to note the relevance this area has had in the market in previous trading.
With the strong resistance and long tailed pin, we’ll be looking to short the pair reacting to Mondays movements. 83.50 presents itself as the next relevant area of support which we will be using as an initial target. Our stop will be placed just above Mondays pin.