7 Dimension Analysis For NZDCHF 🕛 TOPDOWN - Navigating a Bearish Market with Strong CHF Dominance
Overview: CHF stands as a dominant force in the forex market, consistently overpowering NZD according to historical data. A crucial breakdown in the monthly structure, especially in August, has placed this pair in a post-breakout scenario for the past four months, signaling a looming substantial selloff. On the weekly chart, the market is in a bearish buildup, struggling to surpass previous high levels and experiencing rejection from a significant supply zone.
😇 7 Dimension Analysis
Time Frame: Daily
1️⃣ Swing Structure: Bearish
🟢 Structure Behavior: Break of Structure (BoS)
🟢 Swing Move: Initial Impulsive
🟢 Inducement: A noteworthy move from the point of interest, followed by a deep pullback completed with an Institutional Funded Candle (IFC).
🟢 Internal Structure: Liquidity sweep indicates a strong reversal. Extremes in overbought conditions have been mitigated, signaling a strong sell.
🟢 Resistance/Supply Areas: Multiple confluences, including resistance, supply, distribution, and premier, are aligned, suggesting a potent reversal zone.
2️⃣ Pattern
🟢 CHART PATTERNS
Descending Triangle: Signaling bearish continuation.
Shakeout Continuation: Supporting the bearish bias.
🟢 CANDLE PATTERNS
Key Observations:
Record session count with five consecutive bullish candles, ending with shrinking long wicks.
Inverted Hammer and gravestone Doji, indicating indecision and potential reversal.
Climax player activity is notable.
3️⃣ Volume Spread Analysis (VSA): Indicates a high number of sellers at the current point.
4️⃣ Momentum RSI:
🟢 Momentum State: Bullish to sideways.
🟢 Range Shift: Bullish to sideways with loud moves, suggesting a 90% likelihood of further downside.
🟢 Loud Moves: Completed their cycle, preparing for further downside.
🟢 Overbought Rejections: Count of 1.
🟢 Grandfather Father Son Entries: 50% probability setup.
5️⃣ Volatility Bollinger Bands:
🟢 Bands above the middle band.
🟢 Squeeze initiating volatility compression.
🟢 Head fake done with the upper band.
🟢 W pattern completed.
🟢 Band Puncher at the upper band, a powerful reversal signal.
6️⃣ Strength - ROC Values: Equal at the point.
✔️ Entry Time Frame: Daily
✅ Entry TF Structure: Bearish
☑️ Current Move: Impulsive
✔ Support/Resistance Base: Extreme OB rejection.
☑️ Candles Behavior: Bearish long wicks, gravestone Doji.
☑️ Trend Line Breakout: Awaiting confirmation.
☑️ Final Comments: Waiting for a sell signal.
💡 Decision: Short this pair upon tomorrow's open on trend line breakout and H1 churn.
🚀 Entry: 0.5375
✋ Stop Loss: 0.5529
🎯 Take Profit: 0.50
2nd Exit if Internal Structure Changes, 3rd Trendline Breakout, FOMO.
😊 Risk to Reward Ratio: 1:5
🕛 Expected Duration: 60 days
SUMMARY: The analysis maintains a bearish perspective, emphasizing potential for a substantial selloff. The strategy involves shorting the pair upon confirmation of a trend line breakout, with various indicators aligning to support the bearish bias. Considerations include multiple confluences at resistance areas and the completion of a W pattern at the upper Bollinger Band, reinforcing the expectation for a downward move.
