GBP/CHF: Pair Has Violated Downtrend Line With Rounding Bottom Pattern

October 05, 2018

 

By looking at the daily technial chart we can see that pair was trading in downtrend channel with full of bearish momentum and heading towards south side. From technical prospective bears have breached the key support level of 1.2871, which is the psychological level and marked a new low of 1.2450 level on the daily chart.

 

Well after making the mentioned low bears could not manage their self and at the same time bulls made a fabulous counter attack with a bullish harami candlestick followed by a big bullish marabuzo candlestick and after that bulls took the pair towards north side and made a high of 1.2979 levels in short term. In the in the meantime, bulls has given us valid breakout of the downtrend line which was lying on the chart since last 4 months. Presently pair is trading and sustaining above this downtrend line and creating a bullish momentum.

 

 

By applying the fibonacci retracement line it seems like pair is first approaching the 38.2% retracement line and then 50% level which is lying at 1.3157 level. The situation is favourable for bulls as we can see that a potential rounding botto pattern is also forming on the daily technical chart which is generating bullish signal and favoring the bulls for further upside movement.  Odds are in favor of bulls and intraday bias remains bullish on the pair as long as 1.2750 level remains intact. Some profit booking can’t be ignored  but that should be taken as buying opportunity for those who has missed earlier.

 

A bullish crossover on MACD indicator along with a bullish divergence on MACD is supporting the bulls and RSI is also favoring the bulls from above 50 territory. The 1.2750 is immediate support level followed by 1.2600 level whereas 1.3050 level is immediate resistance level followed by 1.3150.

 

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