Hello traders! In multiple of my previous analysis I’ve been featuring CHF related currency pairs, and this is for a reason. The Swiss Franc is starting to look weak, along with the Gold, which is expected to correct down strongly. So here comes the GBP/CHF currency pair, where we might witness either a small but fast corrective wave to the upside or a potential trend reversal.
On the 30-minute chart, there was a double bottom formed at 1.1746. At the same time, the RSI oscillator formed a bullish divergence after which price broke above the downtrend trendline, 50 Simple and Exponential Moving Averages. This could have been a trigger point for buyers, and indeed, the price has begun to produce higher highs and higher lows.
On this chart there are two Fibonacci indicators, to help us determine the potential upside target or the nearest level of resistance. The first Fibs was applied to the 15-16 June wave up, and the second Fibs was applied to the corrective wave down after breaking the trendline. We can see that 88.6% and 461.8% retracement levels meet together at 1.1884, which could be the key resistance for the GBP/CHF currency pair in the short timeframe.
Therefore, as long as price remains above the 1.1762, the support produced after breaking the trendline, price should be expected to rise. The expected move is around 80 pips, which is quite small for such a pair as GBP/CHF. However, there could be a break above the 1.1884 resistance, which is likely to confirm further growth in the long term.
Bias: Bullish while below 1.1762
Potential Support Zone: 1.1790 – 1.1800
Potential Targets: 1.1884
Have a profitable trading!