GBP/CHF: Fib bounce with great Reward/Risk ratio!
My previous idea on this pair identified several possible advanced patterns that could be developing.
At the moment however we are caught in between 2 Fibonacci retracement levels of the big move down from 11 to 24 August.
The advantage of this however is that we can now be almost sure that the X point of the possible bat pattern can best be taken from the August 11th high and not from the August 18th high... (I think...)
As for the current situation, based on the 1H chart I am planning on getting long on a bounce off of the support zone at the .382 fib level. A move up could potentially be stopped by a down sloping trendline as drawn in the chart.
SL could be very tight, below the support zone or a bit lower (possibly at the 1.13% extension of the last move down), with possible targets being:
1. The .382 retracement of the last move down
2. The .50 retracement of the last move down (below the .50 retracement of the XA leg of the possible bat)
3. The .618 retracement of the last move down OR the "down" trendline resistance (whichever comes first)
4. The .886 retracement of the last move down (and a possible D of an advanced pattern still to unfold)
5. The upper boundary of the range OR the 100% retracement of the last move down OR the .618 retracement of the XA leg of the possible bat
Alot of targets, but alot of opportunity too if you ask me...
There is ofcourse the possibility that we break the support zone to the downside so use good money management as always. If it breaks down then ofcourse I will trade that breakout, hoping the strong support zone will then become a strong resistance zone with equally good R/R! :-) ;-)
At the moment however we are caught in between 2 Fibonacci retracement levels of the big move down from 11 to 24 August.
The advantage of this however is that we can now be almost sure that the X point of the possible bat pattern can best be taken from the August 11th high and not from the August 18th high... (I think...)
As for the current situation, based on the 1H chart I am planning on getting long on a bounce off of the support zone at the .382 fib level. A move up could potentially be stopped by a down sloping trendline as drawn in the chart.
SL could be very tight, below the support zone or a bit lower (possibly at the 1.13% extension of the last move down), with possible targets being:
1. The .382 retracement of the last move down
2. The .50 retracement of the last move down (below the .50 retracement of the XA leg of the possible bat)
3. The .618 retracement of the last move down OR the "down" trendline resistance (whichever comes first)
4. The .886 retracement of the last move down (and a possible D of an advanced pattern still to unfold)
5. The upper boundary of the range OR the 100% retracement of the last move down OR the .618 retracement of the XA leg of the possible bat
Alot of targets, but alot of opportunity too if you ask me...
There is ofcourse the possibility that we break the support zone to the downside so use good money management as always. If it breaks down then ofcourse I will trade that breakout, hoping the strong support zone will then become a strong resistance zone with equally good R/R! :-) ;-)
Trade closed: target reached
