Looking for chart patterns that are just about to play out or one that’s already going for a retest?
I’ve got you covered with these plays on GBP/AUD and GBP/CHF!
Take a look at these reversal and breakdown setups.
If you missed the bearish breakdown on this pair’s descending triangle, don’t worry! You might still have a chance to catch this retest that’s currently happening.
GBP/CHF found some support around the 1.1000 major psychological mark and is now pulling up to the 38.2% Fib level. This is right smack in line with the former triangle bottom, which might hold as a ceiling.
Stochastic has a bit of room to climb before reflecting overbought conditions, though, so the correction might keep going until buyers are completely exhausted.
In that case, the pair could retrace to the 50% Fib closer to the 1.1200 major psychological level and the dynamic resistance at the moving averages. The line in the sand for a bearish pullback would be at the 61.8% Fib at 1.1224.
If any of these hold as resistance, GBP/CHF could resume the drop to the swing low or even slide by the same height as the formation or roughly 400 pips.
Hoping to catch an actual breakdown and reversal?
Better keep your eyes locked on this double top neckline of GBP/AUD!
The pair is just making its way down to test the support area around the 1.8150 minor psychological mark, and a break lower could set off a drop that’s the same height as the chart pattern.
Technical indicators are pointing the other way, though, as the 100 SMA is still above the 200 SMA to reflect the presence of bullish vibes.
In addition, the pair is trading above both moving averages, so these might hold as dynamic support. If that’s the case, GBP/AUD might still bounce back to the resistance around the 1.8300 handle.
Also, Stochastic is indicating oversold conditions and is starting to turn higher to signal a return in upside pressure.
Just make sure to watch out for either reversal or breakout candlesticks at the neckline when trading this one.
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