GBPCHF - AB=CD formation and bespoke resistance to limit buying

Ian Coleman FXStreet

Technical

Monthly: A bearish Elliott Wave pattern (5-waves) was compete at the 2011 low of 1.1462. Price action is holding within a triangle formation. Ichimoku Cloud resistance is seen at 1.4092.

Weekly: For the last 80 weeks we have held within a bullish channel formation. The trend line resistance is currently located at 1.3907. Bespoke resistance is seen at 1.3980. With the weekly chart posting a DeMark 7 (9 highlights a correction) there is no clear indication that the upward move has to come to an end.

Daily: Although the daily chart highlights a bearish Outside Day, often an indication that a top is in place, there is no clear indication that the rally has come to an end. A full AB=CD formation would take the cross to 1.3975 (close to bespoke resistance). Further rallies are likely to highlight bearish divergence in lower timeframes. Our medium-term bias is now to sell into rallies.

Action: We look to Sell at 1.3970

Stop: 1.4150

Targets: 1.2900 and 1.2546

Article produced by Pia First for Orbex Limited

Visit PIA First for FX, Commodity & Stock Market trade ideas

Author

Ian Coleman

FXStreet

Ian started his financial career at the age of 18 working as a Junior Swiss Broker at Godsell Astley and Pearce (London). He quickly moved through the ranks and was Desk Manager at RP Martins at the age of 29.

EUR/USD turns negative near 1.1850

EUR/USD has given up its earlier intraday gains on Thursday and is now struggling to hold above the 1.1850 area. The US Dollar is finding renewed support from a pick-up in risk aversion, while fresh market chatter suggesting Russia could be considering a return to the US Dollar system is also lending the Greenback an extra boost.

GBP/USD change course, nears 1.3600

GBP/USD trimmed most of its intraday gains and approaches the 1.3600 threshold. Tepid United Kingdom data released earlier in the day adds to Sterling Pound retracement, as the flash estimate of the Q4 Gross Domestic Product posted a modest 0.1% advance in the three months to December.