Hi Traders! CHFJPY forecast follow up and update is here. On October 26th I shared this “CHFJPY 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
Looking at the H1 chart, we could see that currently it looks like a flat correction is happening in the form of a range. While measuring the first and second wave inside this range we have two key support zones that has formed. The first key support zone is formed by the 100%(123.581) Fibonacci expansion level of the first wave, 100%(123.540) Fibonacci expansion level of the second wave and the bottom of the range. The second key support zone is formed by the 161.8%(123.135) Fibonacci expansion level of the first wave and 161.8%(123.087) Fibonacci expansion level of the second wave. Also, we have a bullish divergence that has formed between the first low that has formed at 123.722 and the second low that has formed at 123.534 based on the MACD indicator which we may consider as evidence of bullish pressure. Until both the key support zones hold my view remains bullish here. If the price breaks and holds above the top of this range we may then consider it as validation for the bullish view and may expect the price to move higher further.
CHFJPY H1(1 Hour) Chart Current Scenario
In this pair my view was bullish and I mentioned that “if the price breaks and holds above the top of this range we may then consider it as validation for the bullish view and may expect the price to move higher further”. The validation for the bullish view which is a valid breakout above the top of the range happened as I expected it to. The price then provided a deeper pullback with the price reaching the first key support again, respected it and bounced higher from this zone. This pullback happened in the form of double wave down with the price creating a bullish divergence between the first low that has formed at 123.574 and the second low that has formed at 123.513 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 the price moved higher further as I expected it to and delivered 200+ pips move!
(Note: You can learn about a Killer Forex Strategy “Double Trend Line Principle” here)
So traders, when it comes to trading, there are various important factors that we need to pay attention to, just because we have a good setup doesn’t mean that we can enter the trade randomly and it will pay us huge profits. First of all, we need to validate the entry and we should have a perfect entry plan to get into the trade which is a key factor when it comes to trading. This CHFJPY forecast is yet another good example of this scenario.
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Happy Trading!
Arvinth Akash
Traders Academy Club Team
