FX.co ★ GBP/CHF Shows Up a Hanging Man

Technical Outlook:

Yesterday we saw further signs of a major reversal ahead. The right shoulder resistance level at 1.4620/30 has been tested and bulls have failed to break through. Major resistance remains at 1.4790 levels. The chart shows a possible Head and Shoulder formations on a Daily Chart. If this count is fixed, it could be a major trend reversal. Therefore, we recommend to remain short and build up on fresh short positions here.

Chart Setup and Trade Recommendations:

As shown above, we are still at the possible Right Shoulder formation on the Daily Chart. Furthermore, adding to our bearish confirmation, yesterday there was a hanging man. We are 80% sure that the movement starting from here will be of the downside character resu;ting in the reversal. Also concidering the Wave Structure, we are at C (Right Shoulder) of major AB boundary which started at 1.4790 levels (projected as strong resistance). We have 3 strong confirmations below to expect a strong reversal towards 1.3790 levels. It would be a sharp fall.

1. Right Shoulder carved out on Daily Charts

2. Bulls have failed 4 times to break through 1.4620/30 levels since last week.

3. Yesterday there was a Hanging Man, most probable move should be down hereafter.

Trade Recommendations: Issued last week, Still Holding True..

Sell @ 1.4520/40, Stop @ 1.4790, Target1 @ 1.3950, Target2 @ 1.3790.

Best Regards,