Hello Traders and welcome back to this week's Sunday Market Review. This week we have a price action analysis on:
- CAD/CHF - Daily
- EUR/JPY - Daily
- GBP/USD - Hourly - 15 M
CAD/CHF - Daily
Here on the CAD/CHF, we have a breakout of a falling wedge. We have 2 tests on the lower trendline and 2 tests on the upper trendline which form this pattern. This is a bullish breakout on the daily chart. At the moment, price is consolidating below a minor resistance level. In my opinion, price is overbought and requires time to correct itself before entering. Waiting for a bullish confirmation on the lower timeframes is advisable.
EUR/JPY - Daily
On the EUR/JPY we have a textbook double bottom. This is a bullish pattern. You can identify this pattern by observing 2 equal leveled bottoms followed by a break of a neckline as shown in the chart. After the breakout, price retraced back into the neckline area. Going long here at the retest is certainly an option with a SL below the recent low.
GBP/USD - Hourly
Alright, this is also a falling wedge pattern on the GBP/USD, however instead of a trend continuation like in our first chart, we have a trend reversal here. The pattern is contained by 2 converging trendlines with highs and lows indicated by the arrows. After the breakout, my bias for direction is to go long on the lower timeframes.
GBP/USD - 15 M
Moving to a lower timeframe on the GBP/USD, we see another bullish pattern. This is a descending triangle. Many Traders correlate descending triangles with bearish patterns. However, in this case, a break of the trendline to the upside also provides bullish momentum.
Note that we have a bullish breakout on the higher timeframe on the GBP/USD and a bullish breakout on the lower timeframe as well. This confluence I call Momentum Alignment and it is a powerful tool to find high probability setups, by using the momentum of multiple timeframes in your favor.
This is it for this week's Market Sunday Review.
I hope you've enjoyed it and I wish you wonderful trades in this upcoming week.
Khac Tu Nguyen, FTMO Support