Hi Traders! CADCHF forecast and technical analysis post 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! here). Now, let’s start our analysis from the highest timeframe which will be the daily chart here.
CADCHF D1(Daily) Chart Analysis – Bullish Channel, Parabolic Sar
On the daily chart, we have a bullish channel that has formed which started on 30th July 2020. This channel is formed by the highs and lows reaching parallel support and resistance zones. The price which is bouncing higher from the bottom of this channel has currently reached the middle of it. The price still has room higher towards the top of this channel. Also based on the Parabolic Sar the dots are below the price, which we may consider as evidence of bullish pressure. In addition to this, there are no signs opposing this bullish view. We may now move down to lower timeframe and see if we can find evidences supporting this bullish view.
CADCHF H4(4 Hours) Chart Analysis – Bullish Convergence, Downtrend Line Breakout, Strong Support Zones
On the H4 chart, we have a bullish divergence that has formed between the first low that has formed at 0.69454 and the second low that has formed at 0.69046 based on the MACD indicator. Then the price moved higher and broke above the high at 0.69910 creating higher highs, thus forming a classical setup of bullish divergence followed by bullish convergence. Hence as per the book scenario, after a bullish convergence, we may look for corrections to happen and then further continuation to the upside. Currently, it looks like the correction that we were looking for is happening. Also, the price which is moving higher has broken above the most recent downtrend line. In addition to this, the ADX indicator gave a bullish signal 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 these as other evidences of bullish pressure. Until the two strong support zones shown in the image below holds my view remains bullish here.
Technical Analysis & Forecast Summary
CADCHF D1(Daily) Chart Analysis
- Bullish Channel, Parabolic Sar
CADCHF H4(4 Hours) Chart Analysis
- Bullish Convergence, Downtrend Line Breakout, Strong Support Zones
Trading Tips
It is always recommended to look for confirmations before you jump into any trade. If you are not sure about how to trade this buy setup then you can use any setup and strategy that you have in your arsenal to look for bullish moves and join this buy trade.
Also, don’t forget to protect your buy trade using a stop loss and make sure to set a target and keep a proper risk/reward ratio.
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Happy Trading!
Yordan Kuzmanov
Chief Trader at the Traders Academy Club
