Hi Traders! GBPCHF short term forecast follow-up and update is here. On March 23rd 2023 I shared this “GBPCHF Short Term Forecast And Technical Analysis” post in our blog. In this post, let’s do a recap of this setup and see how it has developed now. If you would like to learn more about the way we trade and the technical analysis we use then check out the Home Trader Club. Spoiler alert – free memberships are available!
My Idea
On the H1 chart the price which is moving higher has created a bullish trend pattern in the form of three higher highs, and higher lows, we may consider this as evidence of bullish pressure. Generally, after a bullish trend pattern, we may expect corrections and then potential continuation higher. Currently, it looks like a correction is happening and the price which is moving lower has reached a strong support zone. We also have a bullish divergence that has formed supporting the H4 bullish hidden divergence between the first low that has formed at 1.12298 and the second low that has formed at 1.12287 based on the MACD indicator, we may consider this as another evidences of bullish pressure. There are two possible scenarios from here, the price might move higher from the current zone or alternatively if it moves lower then the next area to look for bullish setups with bullish evidences would be the second strong support zone.
GBPCHF H1(1 Hour) Chart Current Scenario
Based on the above-mentioned analysis my short-term view was bullish here and I was expecting the price to move higher further until the two strong support zones hold. The price action followed my analysis here exactly as I expected it to. After the bullish trend pattern, the pullback that I was looking for happened with the price creating a bullish divergence between the first low formed at 1.12298 and the second low formed at 1.12052 based on the MACD indicator. The price then moved higher and broke above the most recent downtrend line, we may consider these as facts provided by the market supporting the bullish view. Most importantly, the price which was moving lower reached the first strong support zone, respected it and then it bounced higher from this zone. The price then moved higher further as I expected it to and delivered 200+ pips move to the upside.
As traders we always have two choices, the first one is to fall in love with our analysis and try to convince the market and expect the price to move in the direction as per our wish. The second one is to follow the facts that the market provides us and make the right actions according to that. As you know the first option won’t help us and as you can see in the example above what happened when we followed the facts that the market hinted to us and took the right action according to that.
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Happy Trading!
Arvinth Akash
Home Trader Club Team.
