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XM Research

Technical Analysis – CHFJPY hits fresh record high as yen falls apart

- Marios Hadjikyriacos

CHFJPY hit its highest levels in at least four decades this week, since official records began. The pair is flying higher and higher into uncharted territory as the relentless uptrend has gone into overdrive. That said, most indicators suggest CHFJPY is increasingly overbought and might be subject to a correction before the rally resumes. 

Momentum oscillators such as the RSI have risen to extreme levels on the weekly chart, and there seems to be some divergence forming, as the pair continues to rise but the RSI seems to be flatlining. Similarly, the MACD is at very elevated levels and CHFJPY is also trading near its upper weekly Bollinger band, a testament to how forceful the uptrend has been. 

A potential pullback in the price could stall near the 155.50 region, which acted as resistance on the way up and may now serve as support. Even lower, the spotlight would shift to 151.40, an area that capped the rally in late 2022. 

Now in case the pair simply continues moving higher into unmapped waters, the focus would turn to round psychological numbers that might halt the advance, at least temporarily. Specifically, the 170.00 level would attract some attention. If that’s violated too, the rally could stretch towards 174.00, which is the 261.8% Fibonacci extension of the late 2022 - early 2023 correction. 

In short, CHFJPY is in a clear and powerful uptrend, although momentum indicators warn that the rally is a little stretched at this stage. 

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