We’re talking European currencies today, forex brothas! Let’s revisit EUR/CHF and GBP/CHF’s charts and see if you can spot new setups this week!
Remember that trend line + SMA + Fib play that we marked a coupla days back? Well forget that, that ship has sailed.
Today we’re talking about a potential ascending triangle breakout on GBP/CHF’s 1-hour chart. As you can see, the pair is starting to really test the limits of the 1.1925 resistance level.
Can the bulls power through? A long trade at the earliest confirmation of a breakout could lead to a retest of the 1.2030 previous support level.
Not a breakout trader kinda guy? That’s fine, you could also wait for a retest of the broken resistance if and when the pair does trade above the level. Just remember that a retest is not a sure thing when it comes to breakouts!
If you’re not confident that the pound will see an upside breakout during THIS retest, then you could also wait for a possible pullback to the trend line support or even a break below the trend line before you pull the trigger on your orders.
EUR/CHF bulls and bears are having a tight battle around the 1.0900 major psychological handle, which is right smack at the 100 SMA on the 4-hour chart. What’s more, it’s also just above the mid-channel level of that downtrend that we took advantage of late last month!Will the euro extend its losses against the franc? A short trade at the earliest signs of bearish momentum could still get you decent pips especially if the pair ends up dropping below its 1.0840 August lows.
If you think that the bulls can do better than the current levels before they give the reins to the bears, then you could wait for a retest of the channel resistance or even the 200 SMA before you jump in on EUR/CHF’s downtrend.
Good luck and good trading this one, buds!