Nah, ya ain’t got a case of déjà vu–that there is an updated chart of our setup for CHF/JPY from last Friday. And if y’all can still recall, the pair was at 115.20 back then. And we was expecting a pullback, so we was lookin’ to go short on the pair. Well, look at where the pair be at now, dawg. That’s right! We got bank!
Anyhow, I also told y’all to keep an eye on how the pair reacts to the 38.2%, 50%, and 61.8% Fibonacci retracement levels, since they all look like good pullback areas. And presently, the pair is at the 61.8% retracement level around the area of interest at the 113.80 handle. An opportunity to go long may therefore present itself sooner or later. Also, if we take the latest price action into account, we can see that an ascending channel has formed. Not only that, the pair is currently at the channel’s support area, which is another technical argument for the pair to form here. You may want to prepare for a downside channel breakout as well, though. For one, price has been closing below them moving averages, which implies strong bearish interest. Another is that stochastic is moving back down without ever reaching overbought territory, which is also a sign of strong bearish interest. And a good confirmation for a downside channel break is if the pair smashes past 113.40. If that does happen, then them bears would likely be gunning for 112.50 next.
The pair staged an upside breakout from the descending channel that we identified back on January 17. And presently, the pair is pulling back after finding resistance at the 1.2600 major psychological level. In addition, price is currently testing the 50% Fibonacci retracement level, which happens to line up rather nicely with the area of interest at the 1.2380 handle. Y’all therefore better start lookin’ for opportunities to go long. And all the more so, given that stochastic is about to indicate oversold conditions and all that. Just be ready to bail if the pair smashes past 1.2320 with great momentum, though, since that could be a sign that them bears are trying to push the pair back into the channel. In addition, the fact that stochastic recently keeps getting pushed back down without ever reaching the overbought is also a sign of strong bearish interest. Anyhow, just make sure to practice proper risk management, a’ight?
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