7:1 Risk to Reward sell Setup for USDCHFCore Analysis Method: Smart Money Concepts
Based on the Smart Money Concepts methodology, the following analysis has been conducted:
😇 7 Dimension Analysis
Time Frame: H1
Swing Structure:
The current swing structure is totally bearish with a proper inducement.
The corrective swing move has already reached its mid-Point of Interest (POI) with four pullbacks. Now, the internal structure has turned bearish, indicating the start of another impulsive move.
The mid of the move contains OB (Order Block), SOB (Significant Order Block), and FVG (Fair Value Gap), which are important areas for sellers. This zone also acts as a Change in Polarization (CIP), making it crucial for a potential downward move.
Pattern:
🟢 Chart Patterns:
A Head and Shoulders reversal pattern has formed, with the neckline broken, indicating a strong bearish sentiment.
🟢 Candle Patterns:
Follow-up momentum candles have appeared as engulfing patterns at the neckline breakout, confirming the bearish trend.
Volume:
🟢 A significant increase in volume was observed at the breakout point, signaling that bears are taking control at this level. This strong volume supports the bearish continuation.
Momentum RSI:
🟢 The price has entered a super bearish zone with a perfect range shift.
There is a bearish divergence at the top, and the price has taken a strong rejection from the highest point with a loud move. This makes the pair more attractive for sellers, as the momentum favors a downward continuation.
Volatility Bollinger Bands:
🟢 The contraction phase has led to a squeeze breakout, with one candle already closing outside the lower band. The "walking on the band" phase is about to start at the lower band, indicating sustained bearish volatility.
Strength ADX:
Bears are stronger than bulls in every dimension, according to the ADX.
Rating: ⭐⭐⭐⭐⭐
All parameters are in favor of sellers, giving this setup a strong 5-star rating, indicating high confidence in the bearish continuation.
✔️ Entry Time Frame: H1
✅ Entry TF Structure: Bearish
☑️ POI: Mid-point mitigated
💡 Decision: Sell
🚀 Entry: 0.8668
✋ Stop loss: 0.8717
🎯 Take profit: 0.8310
😊 Risk to reward Ratio: 7RR
🕛 Expected Duration: 10 days
SUMMARY:
The analysis suggests a strong bearish setup with an entry at 0.8668, a stop loss at 0.8717, and a take profit target at 0.8310. The risk-to-reward ratio is 7:1, and the expected duration for the trade is around 10 days. All dimensions—volume, momentum, volatility, and strength—are aligned in favor of the bears, making this a high-confidence trade. Close monitoring is advised to ensure the trade remains within the expected parameter
