USDCHF - Ready to reverse?

USDCHF has fallen to an area of support on the weekly chart, the 38% retracement of the 2011 lows/2012 highs, that could provide a bounce higher for the pair. Risk is well-defined: the channel bottom coincides with the .88 level, which is ~70 pips away, and should provide strong support in the case of a spike lower. Adding to the possibility of a reversal is that the US dollar index, DXY, is at a key area of support around the 79.90 area on the daily chart..

Going long USDCHF near current levels with a stop below .88, initial target of .92 and longer-term target up near the channel top, offers great risk/reward. Remember, though, that this is on a weekly basis so the trade is long-term in scope.