A war room member spotted a setup here on the CADCHF pair that I thought I would share today – shout out to tthuynh.
Check your weekly charts here and you will see a decent weekly resistance level here, which is a good location for a reversal to occur!
The market has rallied into this level, and been clouded by a bearish rejection candle as the market reacted in a bearish manner off the major resistance level.
If this reversal signal plays out, we could see a decent move to the down side develop, possibly turning into a down trend.
For that to happen, the market will need to eventually break into lower lows. A trouble spot for that is a the swing level I marked, which is a hot spot for bullish continuation signals to form.
If a bullish signal forms here, the trend may continue to break into higher highs, or just come back up to test the weekly level to double top, where in this scenario we can watch for a second bearish signal off the weekly level.
Shorting now off this first test off the weekly level is for people with higher risk appetite, but for those more conservative players out there, watch for a double top + sell signal, or a strong trend continuation bullish signal at the swing support.
Mohamed Zedan
of course it is as you mentioned ” good for only a scalp ” 80% of reversals happen with the retest to the swing move high , so guys it’s better to only scalp a trade down
Steve Epperson
Some pairs tend to range for several days or even months before reversing. I’m wondering if this is one of those pairs. The EUR/JPY seems to be setting up that way. It hit a major resistance level about a week ago and is forming a triangle pattern at the top. A huge bearish rejection candle formed on the 8th. It’s amazing how it just stubbornly keeps bouncing off this resistance level. It will be interesting to see how this latest candle closes on the 14th.
Timmy
Looks good but as EUR weakness continues, CHF follows it…