Hi Traders! CHFJPY short term 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 Home Trader Club Spoiler alert – free memberships are available! Let’s start our analysis from the highest timeframe which will be the H4 chart here.
On the H4 chart, we have a bearish divergence that has formed, between the first high formed at 154.495 and the second high formed at 155.547 based on the MACD indicator which we may consider as evidence of bearish pressure. The price then moved lower and has created lower lows based on the MACD indicator which we may consider as another evidence of bearish pressure. In addition to this, we could see that the price which was creating a series of higher highs, higher lows so far has made a turn around and has created lower lows for the first time in a while, which we may consider as yet another evidence of bearish pressure. Also, currently there are no signs opposing this bearish view at the moment. So everything looks good here for the bears and we may now move down to a lower timeframe and look for evidence supporting this short-term bearish view.
On the H1 chart, the price which is moving lower has created a bearish trend pattern in the form of three lower highs, and lower lows which we may consider as evidence of bearish pressure. Generally, after a bearish trend pattern, we may expect corrections and then a further continuation lower. Currently, it looks like a correction is happening. Also, we had two strong support zones that have formed, the price moved lower broke below these zones and is holding below them, we may consider this as yet another evidence of bearish pressure. Currently, these strong support zones are acting as strong resistance zones for us. Also, currently there are no signs opposing this short term bearish move here as well at the moment. So the bottom line here is that all the evidences are favoring the bears here. Until the two strong resistance zones (marked in red) shown in the image below hold my short-term view remains bearish here and I expect the price to move lower further.
CHFJPY H4(4 Hours) Chart Analysis
CHFJPY H1(1 Hour) Chart Analysis
It is always recommended to look for confirmations before you jump into any trade. If you are not sure about how to trade this short-term sell setup then you can use any setup and strategy that you have in your arsenal to look for bearish moves and join this sell trade.
Also, don’t forget to protect your sell trade using a stop loss and make sure to set a target and keep a proper risk/reward ratio.
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Arvinth Akash
Home Trader Club Team.
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