Yo! I’m starting the new week with a Swissy + chart pattern double special, and I’ve got a triangle on CAD/CHF and a channel on CHF/JPY in today’s intraday charts menu.
CAD/CHF has been consolidating for several days already. Price action appears to be tightening to a point, though. And if we connect some of the most recent peaks and troughs, we can see that a symmetrical triangle pattern has formed.
A symmetrical triangle pattern means that bulls and bears are fighting it out. However, neither side has an advantage … yet. And that means that the pair is just as likely to break to the upside as it is to the downside.
We therefore don’t really have a strong directional bias on the pair. And it would even be prudent for y’all to prepare for both topside and a downside breakout scenarios.
Just note that a downside breakout needs to smash lower past 0.7550 before the breakout is validated, with 0.7400 being the most likely near-term destination.
The pair would have to go through the 0.7500 major psychological level, though, so y’all may wanna wait until the pair also moves lower past that before chillaxing.
As for a topside breakout, the pair needs to clear the area of interest at 0.7720, ideally on strong bullish momentum.And the likely near-term target would be 0.7820.
If trading trends is more your thing, then check out that there ascending channel on CHF/JPY’s 1-hour chart.
And as y’all can see, the pair is currently testing the channel’s support at 112.80. Y’all may therefore wanna start lookin’ for opportunities to go long on the pair. And all the more so, given that stochastic is already signaling oversold conditions and all that. Also, them moving averages are still in uptrend mode.
Do keep in mind, however, that there’s always a risk that the pair may continue moving lower and invalidate the setup. So just be ready to bail yo longs (or even switch to a more bearish bias) if the pair moves lower past 112.50 after staging a downside channel breakout.
In any case, y’all just remember to practice proper risk management as always, a’ight?