Hi Traders! Today we are going to talk about NZDCHF sell trade idea. As I do with every technical analysis post, multi-time frame analysis method will be applied in order to look for all the possible evidences that supports my view on the current trading timeframe and two timeframes higher. We will start our analysis from the highest timeframe now which will be daily chart here.
Disclaimer : This is not investment advice. Past performance is not an indicator of future results.
NZDCHF D1 (Daily) Chart Analysis – Bearish Divergence, Parabolic Sar
On the daily chart we can see that the price has created a special cycle and currently it looks like it has completed itself, generally as per the book we may now expect a retrace to happen and currently it looks like a retrace is happening. We also have a bearish divergence that has formed between the first high at 0.65129 and the second high at 0.65510 based on the MACD indicator which supports as an evidence for our bearish view. Another evidence which we can see is based on the Parabolic Sar where the dots are above the price. Now lets move to one timeframe lower and see what we can find there.
NZDCHF H4 (4 Hours) Chart Analysis – Bearish Hidden Divergence
Looking at the H4 chart we can see that currently it looks like the price is creating a potential double wave down. We had a first wave down and then we had a small pullback, then the price created a Bearish Hidden Divergence between the first high at 0.65510 and the second high at 0.64827 based on the MACD histogram indicator and the price is moving lower. So the bottom line here is the H4 chart has evidence which supports our bearish view.
NZDCHF H1 (1 Hour) Chart Analysis – Uptrend Line Breakout and RSI Trend Line Breakout
On the H1 chart the price has created a double wave up, then the price moved lower and we got a breakout below the most recent uptrend line which we may consider as an evidence of bearish pressure. In addition to this we also have a breakout of the uptrend line based on the RSI indicator, we may consider this as an evidence of bearish pressure as well. We may now look for bearish setups with more bearish evidences in order to start looking for the sells.
Technical Analysis & Forecast Summary
Lets recap and summarize the analysis we had so far:
NZDCHF D1 (Daily) Chart Analysis:
- Bearish Divergence, Parabolic Sar
NZDCHF H4 (4 Hours) Chart Analysis:
- Bearish Hidden Divergence
NZDCHF H1 (1 Hour) Chart Analysis:
- Uptrend Line Breakout and RSI Trend Line Breakout
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.
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