Hi Traders! GBPCHF forecast and technical analysis 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! Let’s start our analysis from the highest timeframe which will be the daily chart here.
GBPCHF D1(Daily) Chart Analysis – Bearish Divergence, Parabolic Sar, ADX Indicator
On the daily chart the price which was moving higher created a false break of the psychological level 1.30 and bounced lower from this zone. We also have a bearish divergence that has formed between the first high that has formed on 9th March 2021 and the second high that has formed on 5th April 2021 based on the MACD indicator, we may consider these as evidences of bearish pressure. In addition to this, 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 everything looks good here for the bears and we may now move down to lower timeframe and look for evidences supporting this bearish view.
GBPCHF H1(1 Hour) Chart Analysis – Bearish Trend Pattern, Bearish Divergence, Parabolic Sar, ADX Indicator
On the H1 chart, the price which is moving lower has created a bearish trend pattern in the form of three lower highs, lower lows which we may consider as evidence of bearish pressure. Generally, after a bearish trend pattern, we may expect corrections and then further continuation lower. Currently it looks like a correction is happening and in addition to this, we have a bearish divergence that has formed between the first high that has formed on 26th April 2021 and the second high that has formed on 27th April 2021 based on the MACD indicator, we may consider this as evidence of bearish pressure. Also, based on the Parabolic Sar we could see that the dots are above the price here as well which we may consider as another evidence of bearish pressure. In addition to this, the ADX indicator gave a bearish signal here as well 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. Until the strong resistance zone (marked in blue) shown in the image below holds my view remains bearish here and I expect the price to move lower further.
Technical Analysis & Forecast Summary
GBPCHF D1(Daily) Chart Analysis
- Bearish Divergence, Parabolic Sar, ADX Indicator
GBPCHF H1(1 Hour) Chart Analysis
- Bearish Trend Pattern, Bearish Divergence, 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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Happy Trading!
Yordan Kuzmanov
Chief Trader at the Traders Academy Club
