Hi Traders! GBPCAD channel breakout provides bearish opportunity for us. A detailed analysis of this sell setup is as follows:
GBPCAD D1 Chart:
On the daily chart the price was moving inside a bullish channel. This channel is formed by the highs and lows reaching parallel resistance and support zones. The price which was respecting these two zones so far has currently broken out at the bottom of this channel. We may consider this as an evidence of bearish pressure. We may now look for more bearish evidences on lower timeframes in order to join the bears.
GBPCAD H4 Chart:
On the H4 chart we have a special cycle and currently it looks like this cycle has completed itself. As per the book scenario we may now expect retrace to happen and we have two critical zones that has formed based on the fibo retrace levels of the cycle. We may now expect the price to move higher until it reaches the first critical zone and then we may look for evidences of bearish pressure in order to join the bears. If the price moves higher above the first critical zone then the next area to look for sells with bearish evidences would be the second critical zone.
Note: 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.
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