Scenario Analysis of EUR/CHF 4H Chart
1. Market Structure
The market was previously in a downtrend but experienced a strong bullish breakout around early March.
Price surged upwards, breaking a key resistance zone (now acting as support).
The current price action appears to be forming a rising wedge, a potential reversal pattern.
2. Key Levels
Support Zone: Around 0.9500, which was previously resistance and now turned into a strong support.
Resistance Zone: Around 0.9650, where price is facing difficulty breaking above.
Current Price: 0.95986.
3. Chart Pattern - Rising Wedge
A rising wedge is visible, which is often a bearish reversal pattern.
Price is consolidating near the upper boundary of the wedge, showing signs of exhaustion.
If price breaks below the wedge, a bearish move towards the 0.9500 level is likely.
4. Confirmation Factors
EMA 50: The price is currently hovering around the 50-period EMA, indicating a possible shift in momentum.
Bearish Rejection Wicks: There are multiple rejection candles at the resistance zone, showing seller strength.
Breakout Zone: If the price breaks below the wedge and the gray support zone, it will confirm a bearish move.
5. Trading Plan
Bullish Scenario: If price breaks above the wedge and sustains above 0.9650, it could push towards 0.9700+.
Bearish Scenario: If price breaks below the wedge and the support zone, a drop towards 0.9500 or lower is expected.
Best Approach: Wait for a breakout confirmation before entering a trade.
The market was previously in a downtrend but experienced a strong bullish breakout around early March.
Price surged upwards, breaking a key resistance zone (now acting as support).
The current price action appears to be forming a rising wedge, a potential reversal pattern.
2. Key Levels
Support Zone: Around 0.9500, which was previously resistance and now turned into a strong support.
Resistance Zone: Around 0.9650, where price is facing difficulty breaking above.
Current Price: 0.95986.
3. Chart Pattern - Rising Wedge
A rising wedge is visible, which is often a bearish reversal pattern.
Price is consolidating near the upper boundary of the wedge, showing signs of exhaustion.
If price breaks below the wedge, a bearish move towards the 0.9500 level is likely.
4. Confirmation Factors
EMA 50: The price is currently hovering around the 50-period EMA, indicating a possible shift in momentum.
Bearish Rejection Wicks: There are multiple rejection candles at the resistance zone, showing seller strength.
Breakout Zone: If the price breaks below the wedge and the gray support zone, it will confirm a bearish move.
5. Trading Plan
Bullish Scenario: If price breaks above the wedge and sustains above 0.9650, it could push towards 0.9700+.
Bearish Scenario: If price breaks below the wedge and the support zone, a drop towards 0.9500 or lower is expected.
Best Approach: Wait for a breakout confirmation before entering a trade.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.