Trade Idea – AUDCHF Sell Setup After Trend Line Breakouts

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Trade Idea - AUDCHF Sell Setup After Trend Line Breakouts

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Hi Traders! Today I am sharing with you the AUDCHF sell setup idea. As I do with each and every technical post I analyze multi timeframes and 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.

AUDCHF Weekly (W1) Chart Analysis – Bearish Hidden Divergence And RSI Trend Line Breakout

On the weekly chart the first evidence that we see which supports our bearish view is the bearish hidden divergence that the price has created between the first swing high at 0.72731 on 14th April 2019 and the second swing high at 0.68883 at 3rd November 2019 based on the MACD Histogram indicator. The next evidence that we could find is on the RSI indicator where we can see an uptrend line breakout which we may consider as another evidence of bearish pressure. So now lets move to one timeframe lower and look for potential evidences that supports our view.

Trade Idea - AUDCHF Sell Setup After Trend Line Breakouts

 

AUDCHF Daily (D1) Chart Analysis – Bearish Divergence And Uptrend Line Breakout

On the daily chart the last divergence that we had is a bearish regular divergence and then the price moved lower and broke below the good uptrend line which the price was respecting so far. After the breakout the price is holding below this dynamic resistance and until this breakout holds my view remains bearish here. The weekly and daily timeframes supports our bearish view with potential evidences, now lets move to one timeframe lower and see if we can find evidences which coincides with our view.

Trade Idea - AUDCHF Sell Setup After Trend Line Breakouts

 

AUDCHF H4 (4 Hours) Chart Analysis – Trend Line Breakout And Parabolic SAR

We have an uptrend line breakout on the H4 chart as well, this makes our bearish view very stronger because we have trend line breakout on all the three timeframes (W1 RSI uptrend line breakout, D1 uptrend line breakout and H4 uptrend line breakout). Also based on the Parabolic SAR we have dots above the price which we may consider as an evidence of bearish trend.

Trade Idea - AUDCHF Sell Setup After Trend Line Breakouts

So all the evidences that we got based on the muti-timeframe analysis on the W1, D1 and H4 timeframes hints us the same thing that the bears might have taken control now and we may now look for bearish setups with bearish evidences (candle stick patterns, false breaks, trend line breakout etc…) in order to start looking for the sells.

Technical Analysis & Forecast Summary

Lets recap and summarize the analysis we had so far:

AUDCHF Weekly (W1) Chart:

  • Bearish Hidden Divergence And RSI Trend Line Breakout

AUDCHF Daily (D1) Chart:

  • Bearish Divergence And Uptrend Line Breakout

AUDCHF H4 (4 Hours) Chart:

  • Trend Line Breakout And Parabolic SAR

 

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.

You will also find a pretty extensive database of educational materials here in the blog – just use the search or check out the Forex Education section above.

Not sure how to enter a trade? Spot reversals (bounces)? Not sure how to spot breakouts?

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Happy trading!

Yordan Kuzmanov
Chief Trader at the Traders Academy Club

 

 

 

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Neil

Thank you Vlad and team

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Luke

Thank you, good blog to follow

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