On the EURCHF pair a fortnight ago, we looked at the weekly timeframe, on which bears have been in control. At the time, the fakey setup was our point of analysis. Two weeks later price has rallied closing above the consolidation.
Based on the fakey setup our bias was bearish. However, price action confirmation was needed to affirm our expectations, especially after the fakey happened at a major level. Bulls came in at the level and pushed prices higher. Will the rally be sustained to the upper boundary of the channel taking into consideration that the main trend is bearish? As always price, the ultimate indicator will guide us.
The US Dollar vs The Canadian Dollar (USDCAD) has been consolidating within an ascending triangle as seen on the daily chart. In this pattern, bulls are in control forming consecutive higher lows. Prices have moved sharply bearish in the past two days, indicating a strong selling pressure.
To increase the probability of our trades whenever we’re looking at patterns, a breakout is needed. Prices could be supported at the lower boundary followed by a rally up, or a breakout downward showing the bearish strength. We therefore protect our capital as we patiently wait for a confirmation.
Disclaimer: This analysis is for educational and general information only and not advice or a recommendation to trade or invest. Do your own research/analysis and don’t blindly enter trades based on the analysis.