GBPCHF 1 Hour Oversold Scottsdale 00:15 24July08 – Idea CLOSED

GBPCHF has risen too high and at too steep of an angle on both the 1 and 4 hour charts. It is oversold and the STOCHASTIC has recently crossed on the 1 hour. At first glance it looks almost divergent – 2 oversold candle patterns however MACD is not divergent. In my opinion this pair has a reasonable chance of retracing to the 62EMA before resuming it’s very new long trend. It broke out of a Surprise box and kept a tight range for about a day and then took off.

The 4 hour shows we are at the top of a very large range. Last time the pair hit the recent SR line it dropped hard and fast. We are looking for a repeat of this pattern but with a conservative initial profit target only down to the 62 on the 1 hour. If we get PIPS then we can move our stops and PT accordingly. Quite possible this will all unfold in the European session and will be missed altogether.

Watch for clear downward candles on the 1 Hour, preferable out of overbought and set profit target just above 62EMA. Low leverage. This pair can move al ot of PIPS, not worth risking much margin on a weak setup.

UPDATE: 23July08 – This trade idea is closed. The trade happened but I was already deeply in the EURUSD short trade. The trade opened and much of it happened during the European session so I missed it either way.

Here are the trade-setup charts for the 1 Hour and 4 Hour:

GBPCHF 1HR Oversold 24July08 GBPCHF 4HR Oversold 24July08

1 Hour 4 Hour

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