All Trade Ideas and trading scenarios found on FX360.com are hypothetical. FX360.com has not placed these Ideas in a live trading environment. Forex Trading involves high risks, with the potential for substantial losses that exceed your initial deposit and is not suitable for all persons. Past performance is not necessarily indicative of futures results.

GBP/CHF To Resume Uptrend?

Last updated 4/21/2009 9:21 PM EST (GMT -5) 0 Comments - Add your comment

• Share this:

Bradley W. Gareiss

Technical Analyst, GFT

The GBP/CHF has been trending up recently as we can clearly see on the 8hr Chart.  There is a bullish Gartley pattern forming within the context of this uptrend.  The Gartley pattern has an unusually large amount of Fibonacci convergence as there are four potential significant lows that could be point X.  The pattern would also complete near the bullish trend line if it continues to fall.  There are no sure things in trading, but this trade setup is an above average setup assuming the pattern completes as drawn.

We are looking to buy the GBP/CHF if it falls to 1.6783 (Point D).  Point D is located at the convergence of the following points:

This pattern has more levels of support in the same area than any pattern I can remember.  However, all patterns can potentially fail, so we will now go over what to watch for assuming the pair continues falling toward our entry at 1.6783.  First, we need to watch how quickly CD completes.  We are looking for the CD leg to drop slowly and enter the trade near our hypothetical entry on the 2hr Chart.  If there are long bars near the completion of the CD leg, we will not take the trade.  Also, if the pair comes within 10 pips of reaching our entry, does not enter, and reaches T1 before entering, the trade is invalid.  The trade is also invalid if the pair rises above 1.7180 before hitting our entry.

To recap, we will look to buy the GBP/CHF at 1.6783 with our stop placed at 1.6705.  Our initial profit targets are 1.6900 (38.2% of CD) and 1.6994 (61.8% of CD).

8hr Chart - Trade would enter near the bullish trend line and several Fibonacci retracement levels.	2hr Chart - Bullish Gartley; buy @ 1.6783.

The information, including Commentary and Trade Ideas, provided on FX360.com should not be relied upon as a substitute for extensive independent research which should be performed before making your investment decisions. Global Forex Trading and FX360 .com is merely providing this information for your general information. The information and opinions presented do not take into account any particular individual’s investment objectives, financial situation, or needs. All investors should obtain advice based on their unique situation before making any investment decision and should tailor the trade size and leverage of their trading to their personal risk appetite. Any projections or views of the market provided by FX360.com may not prove to be accurate.

The views of the authors and analysts are not necessarily those of Global Forex Trading, its owners, officers, agents or other employees. FX360.com and the currency research team will not be responsible for any losses incurred on investments made by readers and clients as a result of any information contained on FX360.com. Global Forex Trading and the currency research team do not render investment, legal, accounting, tax, or other professional advice. If investment, legal, tax, or other expert assistance is required, the services of a competent professional should be sought.

Loading...