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AUD CHF ...will we see a bullish breakout?

做多
OANDA:AUDCHF   澳元/瑞郎
Hi Guys,

The AUD/CHF pair has been in a pretty long downtrend as of late but having had a good look at the weekly and daily chart, this pair is showing some really nice bullish characteristics, indicating a possible strong move to the upside.

The three dashed black lines are shaping into a VCP (Volatility Contraction Pattern, coined by Stock Market Wizard Mark Minervini). Essentialy this pattern is the formation of a wedge with lower highs and higher lows and a breakout above the pivot point or downsloping wedge line.

The horizontal red line along the lows is the first reason I have enter long on this pair as it is entry to a basic strategy I use in all markets, which I alluded to in a previous article called 5 wick rejection. Basically cutting along 5 wicks at any swing high or low/ potential correction reversal points on a chart. The fact that it has printed on a weekly chart makes it more appealing as all patterns are, I suppose due to the time taken for them to happen. Some rea,ly powerful moves come when this strategy works and allows for a nice risk/ reward with not too much analysis involved.

On this occasion though, I can see confluence with the pair making higher lows and printing essentialy a triple bottom, with strong green candles at every low, indicating buying pressure.
The 50, 100 and 200 daily MAs are flattening out and price is moving closer to the long downward sloping trendline.

I probably would have looked for an entry at this point if I hadnt used the strategy for entry reason just to get an early entry/ tighter stop loss in anticipation of a break through the wedge/vcp breakout and the downward sloping trendline.

I haven't traded in the forex market for very long so I am not too sure if volume profile is interpreted in the forex market during pullbacks/consolidation as it is in the stock market but there has been some drying up of volume during this consolidation which is one of the key things to look for during a vcp pattern added with high volume during the breakout.

Would really like to get any opinions about this idea from others as I can see from other articles published on this site there are many talented traders on the Tradingview community with a wealth of knowledge.

Hope this info was useful to some and as always please ensure you use sound risk management before entering any trade

Safe trading all.
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