Brexit dark clouds are still here no matter what - GBPCHF Setup
UK and EU might seem to find a common path after latest talks but Brexit is a fact now, and the Pound won't come out unscathed after 31st December. Even a deal takes place, the economy of UK will be harmed. GBPCHF is an example of how investors will probably be willing to move their funds to CHF after Brexit to seek for a safety shelter.
It's not a secret that Switzerland was always a shelter for the bad days. History won't be any different now. Prepare up.
On a more technical aspect, GBPCHF lastly topped just below 1.22 providing a resistance that bears could rely on to capitalize. This was followed by a bearish wave sequence 1-5. Currently, we find price completing the 4th wave. That means that latecomers jump in the market, and initial positions are increasing, providing more bearish pressure for the Pound vs Swiss Franc.
1.20 is considered to play a catalyst role, on if this setup will be accurate and reliable or not, for two major reasons.
1) It can play the role of a psychological support as a big figure or
2) It could be a "locked level" that cannot be surpassed as wave theory's principal talks about the fact that Wave 4 "DOES NOT" overlap Wave 1 territory.
With these - fundamental and technical reasons - being mentioned, I expect further bearish progression, aiming a major channel support that can be see in the chart below.
It's not a secret that Switzerland was always a shelter for the bad days. History won't be any different now. Prepare up.
On a more technical aspect, GBPCHF lastly topped just below 1.22 providing a resistance that bears could rely on to capitalize. This was followed by a bearish wave sequence 1-5. Currently, we find price completing the 4th wave. That means that latecomers jump in the market, and initial positions are increasing, providing more bearish pressure for the Pound vs Swiss Franc.
1.20 is considered to play a catalyst role, on if this setup will be accurate and reliable or not, for two major reasons.
1) It can play the role of a psychological support as a big figure or
2) It could be a "locked level" that cannot be surpassed as wave theory's principal talks about the fact that Wave 4 "DOES NOT" overlap Wave 1 territory.
With these - fundamental and technical reasons - being mentioned, I expect further bearish progression, aiming a major channel support that can be see in the chart below.
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Daily chart indicating the channel price moves in
