GBPCHF—may be bouncing

The pair has bounced a bit, as it seems wont to do. I’m still short from 1.6897. Earlier this morning I took some partial profits at 1.6784 for + 113 pips since it appeared to be climbing. The pair hasn’t been above 1.7037 this month. Remember that this trade was a pure range trade, ranging from 1.6118 to 1.7113 since mid-September. The low last week was 1.6734.

Resistance is at 1.6851 (.38 retracement from the low, 1.6888 (50% retracement), and 1.6931 (recent high). Support is at 1.6765 (this morning’s low), 1.6734 (last week’s low), and 1.6716 (polarity, which means it has served as both support and resistance).

The three-hour chart appears to have a bull flag formation (for the optimists) or a downward channel. The price projection from this is above 1.75, a psychological round number and polarity. A close above the flag line, around 1.6890 might be worth looking at for a long. On the other hand, shorts would be able to set a tight stop there. The decision will depend on price action at the time.

Here’s the 3-hour chart:


© Dianne Fecteau, 2010. No part of this material may be reproduced in any form, or referred to in any other publication, without the express written permission of the author.

My purpose in writing this blog is to show you how one trader, me, makes trading decisions and survives while trading Forex. One of the biggest problems I had when I first started trading was trying to apply the “rules” to actual trades. Another was the psychology—limiting losses and letting profits run. If you study my blog, you’ll see how I deal with both those issues. So my writings are not trade recommendations but rather educational in purpose. You have to decide on your own approach to trading. Remember that trading is risky.