Sophia Todorova has a background in teaching and psychology, and as such relishes the idea of assisting new traders on their journey to Forex trading success. Technical Analysis is her passion. The charts speak, and she listens.
The Gbpchf weekly chart shows an almost picture perfect example of how well past support works as resistance. In my last article on this pair, I was looking for the shelf at the 1.5850 level to get tested. From there it tumbled back, presenting nice shorting opportunities. It still remains to be seen whether this is the start of a bullish reversal, or if it will be a simple retracement. In reference to the daily chart below, price is currently in the buy zone, above the down trendline. I will be watching the 1.5500 keenly, as I believe that will be a key target for the bears, at the 50% Fibonacci retracement of the recent up move. It is also where the right tip of the potential bullish reversal pattern would find support against the inside of the broken up trendline.
However, if the 1.5400/5500 support were to give way, it would open the way for a retest of the weekly lows. Per the bullish reversal scenario, if it confirms on the daily, and the weekly trendline is successfully breached, the weekly Fibonacci levels would make good targets for longs, up to the 1.6401, 78.6%
Thanks a lot for reading. Follow me on twitter if you would like to discuss this pair. Happy Trading! 🙂
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