Hi Traders! GBPCAD technical analysis and forecast 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!
On the daily chart the price is moving inside a triangle pattern which started on 9th March 2021. The price which is moving inside this pattern has currently reached the bottom of it, created a false break of it and is moving higher. In addition to this while measuring the first wave using the Fibonacci expansion tool, we could see that the we have a key support zone that has formed by 100%(1.68509) Fibonacci expansion level and the bottom of the triangle pattern. The price which was moving lower, reached this zone, respected it and is currently bouncing higher from this zone. Until this key support zone holds my view remains bullish here and I expect the price to move higher further. We may now move down to lower timeframe and see if we can find evidences supporting this bullish view.
Looking at the H4 chart we have a bullish divergence that has formed between the first low that has formed on 4th May 2021 and the second low that has formed on 7th May 2021 based on the MACD indicator, which we may consider as evidence of bullish pressure. Also the ADX indicator gave a bullish signal at the cross of +DI (green line) versus -DI (red line) and the main signal line (silver line) reads value over 25, we may consider this as another evidence of bullish pressure. If we get a valid breakout above the high at 1.71300 (marked in blue line) we may then consider it as a validation for the bullish view and may expect the price to move higher further.
GBPCAD D1(Daily) Chart Analysis
GBPCAD H4(4 Hours) 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 buy setup then you can use any setup and strategy that you have in your arsenal to look for bullish moves and join this buy trade.
Also, don’t forget to protect your buy 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
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