Hi Traders! EURCHF short term forecast and technical analysis post is here. We do our analysis on the MetaTrader4 platform (MT4), some very interesting, useful tips and hacks about the MT4 platform could be found here. As we do in every technical analysis post we are going to perform the multi-timeframe technical analysis on this pair in order to find possible trading opportunities. 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! Let’s start our analysis now from the highest timeframe which will be the H4 chart here.
EURCHF H4(4 Hours) Chart Analysis – Range, Bearish Divergence, Parabolic Sar, Key Resistance Zone
On the H4 chart the price is moving inside a range which started on 4th March 2021. This range is formed by the highs and lows reaching parallel support and resistance zones. The price which is moving inside this range has currently reached the top of it and is moving lower. The price has created multiple false breaks and bearish divergences between the first high that has formed on 15th April 2021 and the second high that has formed on 28th April 2021 which we may consider as evidences of bearish pressure. Also based on the Parabolic Sar we could see that the dots are above the price which we may consider as another evidence of bearish pressure. Also we have a key resistance zone that has formed based on the 100% (1.10805) Fibonacci expansion level of the first wave and the top of the range. The price which was moving higher, respected this zone and is bouncing lower from this zone. Until this key resistance zone holds my view remains bearish here. So everything looks good here for the bears and we may now move down to lower timeframe and look for evidences supporting this bearish view.
EURCHF H1(1 Hour) Chart Analysis – Bearish Convergence, Uptrend Line Breakout, Parabolic Sar, ADX Indicator
On the H1 chart we have a bearish divergence that has formed between the first high that has formed on 2nd February 2021 and the second high that has formed on 1st April 2021 based on the MACD indicator. The price then moved lower and broke below the last low at 1.10232 thus forming a classical setup of bearish divergence followed by bearish convergence, we may consider this as evidence of bearish pressure. As per the book scenario after a bearish convergence we may expect corrections and then further continuation lower. Currently it looks like a correction is happening. Also the price which is moving lower has broken below the most recent uptrend line, which we may consider as another evidence of bearish pressure. Also based on the Parabolic Sar we could see that the dots are above the price which we may consider as another evidence of bearish pressure. In addition to this, the ADX indicator gave a bearish signal here at the cross of -DI (red line) versus +DI (green line) and the main signal line (silver line) reads value over 25 which we may consider as yet another evidence of bearish pressure. So based on all this my view here is bearish and until the H4 key resistance zone holds I expect the price to move lower further in the short term.
Technical Analysis & Forecast Summary
EURCHF H4(4 Hours) Chart Analysis
- Range, Bearish Divergence, Parabolic Sar, Key Resistance Zone
EURCHF H1(1 Hour) Chart Analysis
- Bearish Convergence, Uptrend Line Breakout, Parabolic Sar, ADX Indicator
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 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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To your success,
Vladimir Ribakov
Certified Financial Technician
