Hi Traders! GBPCHF short term 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 – Range Breakout, Parabolic Sar, No Opposite Signs
On the daily chart, we have a range that has formed which started on 5th April 2021. This range is formed by the highs and lows reaching parallel support and resistance zones. The price which was moving inside this range broke above the top of it and then we had a pullback, currently the price has moved higher and has broken above the top of this range again. We may consider this as evidence of bullish pressure. Also, based on the Parabolic Sar we could see that the dots are below the price which we may consider as another evidence of bullish pressure. Also, currently there are no signs opposing this short term bullish view. So based on all this, my short term view remains bullish here and we may now move down to lower timeframe and look for evidences supporting this bullish view.
GBPCHF H4(4 Hours) Chart Analysis – Bullish Divergence, Downtrend Line Breakout, Bullish Trend Pattern, Strong Support Zones
On the H4 chart, the daily chart pullback ended with a bullish divergence which has formed between the first low at 1.25605 and the second low at 1.25027 based on the MACD indicator. The price then moved higher and broke above the most recent downtrend line, we may consider these as evidences of bullish pressure. Also, the price which is moving higher has created a bullish trend pattern in the form of three higher highs, higher lows, we may consider this as another 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. We also had two strong resistance zones that has formed and the price which was moving higher has broken above these zones. After the breakout these strong resistance zones are acting as two strong support zones for us. Until both these strong support zones shown in the image below holds my short term view remains bullish here.
Technical Analysis & Forecast Summary
GBPCHF D1(Daily) Chart Analysis
- Range Breakout, Parabolic Sar, No Opposite Signs
GBPCHF H4(4 Hours) Chart Analysis
- Bullish Divergence, Downtrend Line Breakout, Bullish Trend Pattern, Strong Support Zones
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 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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Happy Trading!
Arvinth Akash
Traders Academy Club Team
