Hi Traders! USDCHF short term forecast update and follow up is here. On November 11th I shared this “USDCHF Short Term Forecast And Technical Analysis” post in our blog. In this post, let’s do a recap of this setup and see how it has developed now. 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!
My Idea
On the H4 chart, the price which was moving lower created a bullish divergence which has formed between the first low at 0.91022 and the second low at 0.90847 based on the MACD indicator. The price then moved higher and broke above the last high at 0.91753 thus creating higher highs. Also, we should note that the price which was in a bearish trend so far creating series of lower highs, lower lows has created higher highs for the first time in a while which we may consider as sign of a possible trend change. We may consider these as evidences of bullish pressure. In addition to this, the ADX indicator gave a bullish signal here at the cross of +DI (green line) versus -DI (red line) and the main signal line (silver line) reads value over 25, we may consider this as yet another evidence of bullish pressure. Until the strong support zone (marked in blue) shown in the image below holds, my short term view remains bullish here and I expect the price to move higher further.
USDCHF H4(4 Hours) Chart Current Scenario
On the H4 chart, based on the above-mentioned analysis my short-term view was bullish here and I was expecting the price to move higher further. The price action followed my analysis exactly as I expected it to here. After the bullish divergence and higher highs, we had a pullback and then the price moved higher further as I expected it to and delivered 160+ pips move to the upside so far!
On the M15 chart, the market provided us with various facts supporting the bullish view. The H4 chart pullback happened in the form of an ABCD pattern on the M15 chart with the price creating a bullish divergence between the first low that has formed at 0.92020 and the second low that has formed at 0.91869 based on the MACD indicator. The price then moved higher and broke above the most recent downtrend line, we may consider these as facts provided by the market supporting the bullish view. Then as you can see in the image below how the price moved higher after that and provided an amazing move to the upside.
(Note: You can learn about a Killer Forex Strategy “Double Trend Line Principle” here)
So, traders, this is why I wanted to show this example to help you understand how important it is to follow the facts. The facts were supporting the bullish view here and there were no signs against it. When the facts do happen as we expected you can see how the price perfectly moved as per the plan. Because these are the kind of hints the market provides us at majority of the times and it’s our obligation as traders to be able to listen to these things that the market tells us and we should try to make the right actions.
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Happy Trading!
Arvinth Akash
Traders Academy Club Team.
