Hi Traders! CHFJPY short term forecast and technical analysis post 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!. Now, let’s start our analysis from the highest timeframe which will be the H4 chart here.
You can watch the video explanation of this idea here
CHFJPY H4(4 Hours) Chart Analysis – Range, Lower Lows, ADX Indicator
On the H4 chart, after the strong bearish move, the price is currently moving inside a range. This range is formed by the highs and lows reaching parallel support and resistance zones. The price which is moving inside this range has reached the top of it, respected it and bounced lower from this zone. The price then moved lower and broke below the last low at 120.392 thus forming lower lows based on the MACD indicator, which we may consider as evidence of bearish pressure. In addition to this, the ADX indicator gave a bearish signal at the cross of -DI (red line) versus +DI (green line), and the main signal line (silver line) reads value over 25, we may consider this as another evidence of bearish pressure. We may now move down to one timeframe lower and see if we can find evidences supporting this bearish view.
CHFJPY H1(1 Hour) Chart Analysis – Heikin Ashi Candles, Bearish Hidden Divergence, Strong Resistance Zones
On the H1 chart, based on the Heikin Ashi candles we can see that currently, we have strong bearish bodies in downward moving market conditions so it basically reflects a bearish environment. We may consider this as an evidence supporting the bears. In addition to this, the price has created a bearish hidden divergence between the first high that has formed at 120.471 and the second high that has formed at 120.031 based on the MACD indicator, which we may consider as evidence of bearish pressure. Also, we had two strong support zones and the price which was moving lower has broken below these zones and holding below them. We may consider this as yet another evidence of bearish pressure. Currently these two strong support zones are acting as two strong resistance zones for us. Until both these resistance zones hold my short term view remains bearish here and I expect the price to move lower further.
Technical Analysis & Forecast Summary
CHFJPY H4(4 Hours) Chart Analysis
- Range, Lower Lows, ADX Indicator
CHFJPY H1(1 Hour) Chart Analysis
- Heikin Ashi Candles, Bearish Hidden Divergence, Strong Resistance 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 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
