USD/CHF Price Analysis: Bulls looking for a discount before bullish breakout
|- USD/CHF is making a move to the upside in a correction of the monthly supply.
- Daily chart offers prospects of a short term bearish correction before the next leg higher.
USD/CHF is correcting a strong downtrend and the bulls will be looking to be on board with what appears to be a weekly reverse head and shoulders breakout in the making.
The following is a top-down analysis of the market that offers potential for some daily consolidation before the next wave to the upside.
Bulls may need to be patient at this juncture.
Monthly Chart
The monthly downtrend has paused and is correcting.
On a lower time frame, we can look for setups that would enable the bulls to be involved with an upside extension.
Weekly Chart
The reverse head and shoulders pattern is clear as day, although the weekly rally may need to correct before a breakout can gather pace towards a 38.2% Fibonacci retracement of the monthly downtrend.
D1 Chart
The price is expected to pull back to pick up liquidity before making the major breakout to the upside beyond current resistance.
At least a 38.2% Fibonacci retracement, or a 50% mean reversion, would meet the criteria in anticipation of bullish conditions.
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