Whattup, forex playas!
I hope you’re in the mood to trade the pound because GBP/CHF looks ready to extend a trend while GBP/AUD is brewing a reversal pattern.
Check them out!
GBP/CHF bulls and bears are going at it near the 1.2600 psychological handle!As you can see, the area lines up with the 100 and 200 SMAs AND is just above a descending channel resistance on the 4-hour chart.
With a divergence sweetening the pot for the bears, will GBP/CHF extend its downtrend? Shorting at the first signs of continued selling is a good bet if you think that the pound will drop back down to its August lows.
Meanwhile, a clear break above 1.2600 could lead to a retest of the 1.2700 or 1.2800 previous inflection points.
What do you think? Which way will GBP/CHF go?
I spy with my eye a Head and Shoulders in the making!No, I’m not talking about what aches for Millennials after a night of sleeping with bad posture. I’m talking about GBP/AUD finding support at the 1.8800 “neckline” on the daily!
A bounce from 1.8800 would open the pound to a move to the 1.8950 previous resistance “shoulder” part of the pattern.
But keep in mind that consolidations patterns like this – especially at the end of a trend – can lead to a reversal.
If the bears don’t wait for a “shoulder” and break through the 1.8800 support instead, then you also gotta be ready to trade a possible dip to 1.8650 or even 1.8500.