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EUR/CHF To Resume Downtrend At 1.5243?

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.

Last updated 10/16/2009 6:37 PM EST (GMT -5) 3 Comments

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Bradley W. Gareiss

Technical Analyst, GFT

The EUR/CHF has been slowing trending down for about two years.  During this drop, the pair has met resistance several times at the bearish trend line seen on the Weekly Chart.  Notice that the bearish Gartley/double top pattern would complete near the bearish trend line.  We are anticipating point C will hold because it is near the exact 61.8% Fibonacci retracement of AB. 

We are looking to the sell the EUR/CHF at 1.5243 (Point D).  Point D is located at the convergence of the following points:

We will now go over possible ways the trade could be invalidated.  First, we need to watch how quickly CD completes.  We are looking for the CD leg to rise slowly and enter the trade near our hypothetical entry on the 4hr Chart.  If there are long bars near the completion of the CD leg, we will not take the trade.  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 falls below 1.5120 before hitting our entry.

To recap, we will look to sell the EUR/CHF at 1.5243 with our stop placed at 1.5267.  Our initial profit targets are 1.5208 (38.2% of CD) and 1.5177 (61.8% of CD).

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  • Weekly Chart - Trade would enter near the bearish trend line.
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  • 4hr Chart - Bearish Gartley; sell at 1.5243.

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.

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Comments (3)

FRXtrader

October 17, 2009 at 12:41 PM ET

Great information! I really appreciate you giving us traders insight on the direction of various currency pairs. I've learned a lot since becoming a member here. I'm looking forward to seeing more beneficial information in the days, weeks, and months to come.

God bless and have an excellent day FX360!!

jacobuzon

October 17, 2009 at 03:22 PM ET

I agree, Mr Gareiss's articles are highly valuable and well articulated. I feel like we should be paying for this.

pipster

October 18, 2009 at 04:22 PM ET

Bite your tongue, lol. I'll gladly pay a commission on winners, don't like payiing on losers though, it's a mental thing I can't get over.

Seriously, always great analysis from Brad.

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