Hi Traders! CHFJPY forecast follow up and update is here. On June 17th I shared this “CHFJPY Technical Analysis And Forecast” 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 H1 chart the price which is 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, the ADX indicator gave a bearish signal here as well at the cross of -DI (red line) versus +DI (green line), and the main signal line (silver line) reads value over 25, we may consider this as yet another evidence of bearish pressure. Until the strong resistance zone (marked in blue) shown in the image below holds my view remains bearish here and I expect the price to move lower further.
CHFJPY H1(1 Hour) Chart Current Scenario
In this pair based on the multi-timeframe analysis my view was bearish and I was expecting the price to move lower further until the strong resistance zone holds. The price action followed my analysis here and moved lower directly without pullbacks, providing around 200 pips move until it was blocked a bullish divergence.
On the H1 chart the market provided us with various facts supporting the bearish view. The price which was moving lower created a flat correction in the form of a range. The price then moved lower, broke below this range and retested the breakout, we may consider these as facts provided by the market supporting the bearish view. Also there were no signs opposing this bearish view. The price then moved lower further and provided an excellent move to the downside.
You can see this clearly on the M15 chart below.
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 bearish 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!
Yordan Kuzmanov
Chief Trader at the Traders Academy Club
Thank you sir