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Let’s go back to the basic chart formations with this USD/CHF descending triangle and NZD/USD double bottom pattern. Better stay on the lookout for breakouts on these!

USD/CHF: 4-hour

USD/CHF 4-hour Forex Chart
USD/CHF 4-hour Forex Chart

Lower highs and support around the .9870 level… Why, that’s a descending triangle chart formation right there!

USD/CHF just bounced off the bottom of its triangle visible on the 4-hour time frame and is now gunning for the top again. If the triangle resistance around 1.0025 keeps gains in check, the pair could stay in this consolidation chart pattern for a few more days. On the other hand, an upside break could send it around 400 pips higher since the chart pattern is of the same height.

The 100 SMA is below the longer-term 200 SMA on this chart, indicating that resistance is more likely to hold than to break. At the same time, stochastic is approaching the overbought territory to signal that buyers might want to take a break and let sellers take over.

NZD/USD: 1-hour

NZD/USD 1-hour Forex Chart
NZD/USD 1-hour Forex Chart

Now here’s a short-term setup for those who might be looking to trade the RBNZ decision this week. The Kiwi failed in its last two attempts to break below the .6850 minor psychological support against the dollar, creating a double bottom formation on its 1-hour chart.

This is a classic reversal signal which suggests that buyers are trying to gain the upper hand and are making a bit of progress. Price has yet to test the neckline around .6970 and make an upside break before Kiwi bulls can claim victory, but the upward crossover in the moving averages hints that the odds are shifting in favor of buyers this time.

Stochastic is also turning higher to show a return in bullish pressure, even without dipping into the oversold region. If this keeps up, a double bottom breakout could send the pair 120 pips higher or the same size as the chart pattern. But if the neckline holds as a strong ceiling, another move towards the bottom could be seen.

Forex Chart Settings:

Slow Stochastic: 14,3,3
100 SMA: Blue line
200 SMA: Red line