Looking for potential risk-off plays on the longer-term time frames?
We’ve got you covered with these setups on GBP/CHF and META!
Better keep close tabs on these potential inflection points:
Heads up for a potential turn back to the longer-term trend on GBP/CHF!
After bouncing hard back in September from the 1.02 handle, GBP/CHF has been steadily consolidating through October and November around 1.13.
On the daily chart above, we can see that this area aligns with several technical signals that could be drawing in tactical sellers, including falling 100 and 200 simple moving averages, as well as the 61% Fibonacci retracement area of the June 2022 to September 2022 swing.
And it looks like that resistance area is confirmed with the pair now moving lower, potentially ready to break the short-term pattern of “higher lows” through October and November.
If that pattern break holds, it could draw in sellers, which could potentially lead to a momentum move lower to the previous swing lows around 1.09 and 1.10 before traders take short-term profits.
Longer-term, a sustained break below 1.09 will confirm a technical return to the longer-term trend, which could possibly lead to a retest of the 1.0500 handle over the next couple of months if bearish pound sentiment persists.
Check out another textbook trend pullback setup in the works on the daily chart of Meta Platforms (META).
The stock pumped higher after finding a bottom just under the $90 handle back in November, but has recently seen sideways action over the past few weeks.
The run higher may still have legs into the new year, and if it does, the falling simple moving averages and Fibonacci retracement levels will be the area to watch and see if sellers take back control longer-term.
Let’s remember that aside from the broad bearish global sentiment on risk assets, META also has to deal with the negative perception around Meta Platform’s “excessive” spending habits, including a large investment (currently over $10B a year) in the Metaverse.
If that theme continues to be the main driver with no TikTok ban to give it a bullish boost, be on the look out for bearish reversal patterns between the $140 – $160 area before considering putting together a bearish strategy.
For the bulls on META, it’ll likely take a combination of a TikTok ban and a positive META earnings report in February to get traders to push the pair above the SMA’s and Fibs.
Be on the look out for that kind of scenario–and broad bullish sentiment on risk assets–before considering a sustained upside break of that area as a signal to put together a long strategy.