The pair of European currencies GBPCHF – British pound vs Swiss franc has been moving in an uptrend since the beginning of the year.
- bullish engulfing on the daily
- MACD in an upward phase
- bullish divergence on H4
At the beginning of April, after establishing the maximum of the year at 1.3075, the price began to fall and at the end of April it reached 1.2577, 500p below this year’s maximum.
The first session of May brought growth and Monday’s daily candle formed a bullish engulfing pattern, accompanied by the establishment of a minimum on the MACD.
Today we observe an attempt to break out of the formation, MACD is rising. If the breakout is successful and MACD remains in the upward phase, it will be a strong signal for the correction of the April declines.
A bullish divergence appeared on the H4 chart supporting the upward scenario. An additional advantage for demand will be the overcoming of the local downtrend line (blue dashed).
Price Action Formations – Bearish Engulfing
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