Failed Bearish Correction, Bullish Continuation: The USD/CHF came back from a triple top and invalidated the price top today after breaking above the central pivot of the range. Price also climbed back above the 100-, and 50-period SMA in the 4H chart, and thus signals bullish continuation. The 4H RSI has popped up above 60, and shows loss of bearish momentum formed when price fell below the triple top.
More Bullish Signs: Note that price has stayed above the rising trendline in from July and one from May. Price has also held above the 200-period SMA in the 4H chart. The Daily RSI reading held above 40, so everything points to a bullish continuation.
USD/CHF 4H Chart (8/19):
USD/CHF Daily Chart 8/19
Trading Plan:
Now looking at the daily chart, we can see that the upside has the 0.9115 high on the month, then the 0.9156 high on the year in sight. We can say the target is 0.9150.
If price comes back to 0.9070, we should be ready for a buy. A break below 0.9050 would be a sign of usd/chf-bull weakness, so our stop-loss can be placed below this level. Let's say we have a stop loss at 0.9040, and an entry at 0.9080. That would yield a 40-pip risk for stop-loss.
Reward to Risk:
If our target is 0.9150, the entry at 0.9080 yields us 70-pip potential reward. This trade has a reward to risk profile just under 2:1. If you can get your entry in at 0.9070, your R:R would improve to 80:30, which is 2.66:1.
Trade Safe, Trade Well.
More Bullish Signs: Note that price has stayed above the rising trendline in from July and one from May. Price has also held above the 200-period SMA in the 4H chart. The Daily RSI reading held above 40, so everything points to a bullish continuation.
USD/CHF 4H Chart (8/19):
USD/CHF Daily Chart 8/19
Trading Plan:
Now looking at the daily chart, we can see that the upside has the 0.9115 high on the month, then the 0.9156 high on the year in sight. We can say the target is 0.9150.
If price comes back to 0.9070, we should be ready for a buy. A break below 0.9050 would be a sign of usd/chf-bull weakness, so our stop-loss can be placed below this level. Let's say we have a stop loss at 0.9040, and an entry at 0.9080. That would yield a 40-pip risk for stop-loss.
Reward to Risk:
If our target is 0.9150, the entry at 0.9080 yields us 70-pip potential reward. This trade has a reward to risk profile just under 2:1. If you can get your entry in at 0.9070, your R:R would improve to 80:30, which is 2.66:1.
Trade Safe, Trade Well.
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