Hi Traders! EURCHF technical analysis and short term forecast 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!. Now, let’s start our analysis from the highest timeframe which will be the weekly chart here.
EURCHF W1(Weekly) Chart Analysis – Heikin Ashi Candles, Lower Lows, Strong Resistance Zone, Bearish Hidden Divergence
On the weekly chart, based on the Heikin Ashi candles we can see that currently, we have strong bearish bodies in downward moving market conditions so it basically reflects a bearish environment. Also, we have clear waves of lower highs, lower lows structure which indicates a bearish trend. In addition to this, the price has broken below the last low at 0.99716 and has created lower lows which is a sign of gaining momentum towards the bearish side. Currently, it looks like a pullback is happening and the price which is moving higher has reached a strong resistance zone, respected it and is bouncing lower from this zone. In addition to this, the price has created a bearish hidden divergence between the first high that has formed at 1.05138 and the second high that has formed at 0.99547 based on the MACD indicator, which we may consider as another evidence of bearish pressure. In addition to this, there are no signs opposing this short term bearish view at the moment. We may now move down to lower timeframe and look for evidences supporting this short term bearish view.
EURCHF H4(4 Hours) Chart Analysis – Bearish Divergence, Lower Lows, Stochastic Oscillator
On the H4 chart, we have a bearish divergence that has formed (supporting the weekly bearish hidden divergence), between the first high that has formed at 0.98002 and the second high that has formed at 0.99547 based on the MACD indicator which we may consider as evidence of bearish pressure. The price then moved lower and broke below the last low at 0.98287 thus creating lower lows which we may consider as another evidence of bearish pressure. Currently it looks like a correction is happening and, based on the Stochastic Oscillator we could see that the price has reached its extreme, which we may consider as yet another evidence of bearish pressure. Until the strong resistance zone (marked in red) shown in the image below holds my short term view remains bearish here and I expect the price to move lower further.
Technical Analysis & Forecast Summary
EURCHF W1(Weekly) Chart Analysis
- Heikin Ashi Candles, Lower Lows, Strong Resistance Zone, Bearish Hidden Divergence
EURCHF H4(4 Hours) Chart Analysis
- Bearish Divergence, Lower Lows, Stochastic Oscillator
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 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.
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Arvinth Akash
Traders Academy Club Team
