Hi Traders! USDCHF short and mid term forecast is here. The way I would like to analyze the chart for setups is based on multi-timeframe confirmations because in my POV if we get more evidences on different timeframes for the same direction then it makes the setup much more reliable. If you would like to learn more about the way we trade and the technical analysis we use then check out the Traders Academy Club Spoiler alert – free memberships are available! Let’s start our analysis from the highest timeframe which will be the H4 chart here.
USDCHF H4(4 Hours) Chart Analysis – Bearish Convergence, Bullish Divergence
On the H4 chart, we had a strong bullish rally, currently it looks like this bullish rally has completed itself and a correction is happening. We could see that the price which was moving higher has created a bearish divergence between the first high that has formed at 0.99655 and the second high that has formed at 1.00641 based on the MACD indicator. The price then moved lower and broke below the last low at 0.98718 thus forming a classical setup of bearish divergence followed by bearish convergence, we may consider these as evidences of bearish pressure. Generally, after a bearish convergence we may look for corrections and then further continuation lower. In addition to this, we have a bullish divergence that has formed between the first low that has formed at 0.96939 and the second current low that has formed at 0.96102 based on the MACD indicator which we may consider as evidence of bullish pressure. So basically, I expect the price to move lower further here after pullbacks.
USDCHF H1(1 Hour) Chart Analysis – Bearish Trend Pattern, Key Support Zone, Bullish Divergence, Stochastic Oscillator
Looking at the H1 chart, we could see that the price which was moving lower has created a bearish trend pattern in the form of three lower highs, lower lows which we may consider as evidence of bearish pressure. Generally, after a bearish trend pattern, we may expect corrections and then further continuation lower. Also, while measuring the first two waves of this bearish trend pattern using the Fibonacci expansion tool we have a key support zone that has formed based on the 261.8%(0.96027) Fibonacci expansion level of the first wave and the 61.8%(0.95847) Fibonacci expansion level of the second wave. Price has currently reached this key support zone and in addition to this, we have a bullish divergence that has formed between the first low that has formed at 0.96968 and the second current low that has formed at 0.96102 based on the MACD indicator which we may consider as evidence of bullish pressure. Also, based on the Stochastic Oscillator we could see that the price has reached its extreme which we may consider as another evidence favoring the short term bullish view. So based on all this, my short expectation is bullish and my mid term expectation is bearish here.
Technical Analysis & Forecast Summary
USDCHF H4(4 Hours) Chart Analysis
- Bearish Convergence, Bullish Divergence
USDCHF H1(1 Hour) Chart Analysis
- Bearish Trend Pattern, Key Support Zone, Bullish Divergence, Stochastic Oscillator
Trading Tips
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Arvinth Akash
Traders Academy Club Team
