While the environment of the current market has been quite day to day, there are several pairs that are setting up on the longer time frames very nicely.
Please note, that the longer term time frames take much longer to develop. However, if the predicted move does “happen”, it will be a solid move that should provide some decent profit.
The pair we would like to focus on today is the EUR/CHF. As we have written in the past, the EUR/USD is developing in to a very nice Daily and 4 hr trade. Well, to no surprise, the EUR/CHF is almost identical. Please take a look at the following Daily chart.
What you will see here is an excellent example of an uptrend being violated, a retest of that trend and a possible fresh cross to the downside developing while being supported by an excellent cloud. This could be a picture perfect swing trade to keep track of and watch for a powerful move to the downside. Look for a new low in price on this chart to use as a consideration for entry confirmed by a new downward cross. Next, we will look at the 4 hr chart to show certain levels and price targets.
What you will see here is 4 hour chart and a more detailed version of what the Daily chart is saying about the pair. The 4 hour chart also shows EXCELLENT cloud construction, a clear rejection of price by the 50% Fibonacci extension and a possible close below the daily uptrend line. Supporting all of that is the 50 CCI being rejected by the 0 line. The 0 line is an area of major support or resistance in that particular time frame in regards to price. Meaning that something clearly rejected the uptrend and promptly caused the price action to reverse. Watch for the 50 CCI to continue making lower lows and the price should follow. The key confirmation will be a fresh Ichimoku cross to the downside and the pair making a new Daily low in price. Follow the trend in terms of the Ichimoku method and look for it to hit the first Fibonacci extension of 1.4500 or 38.2% and possibly more. This is a great trade to follow and could produce a very solid move. Keep an eye on CCI and price to lead the way for an excellent Ichimoku trade. Best of luck to all in trading and in life!!!
Chris Capre is the Founder of Second Skies LLC which specializes in Trading Systems, Private Mentoring and Advisory services. He has worked for one of the largest retail brokers in the FX market (FXCM) and is now the Fund Manager for White Knight Investments (www.whiteknightfxi.com/index.html). For more information about his services or his company, visit www.2ndskies.com.