GBP/CHF Bearish Breakout: Targeting Key Support

By Tomasz Wisniewski|

Published: June 14 2024, 08:21 GMT+0

GBP/CHF Bearish Breakout: Targeting Key Support

In today’s technical analysis, let’s revisit the British Pound to Swiss Franc (GBP/CHF) pair, which I highlighted on June 10th. At that time, I pointed out a correction within a sideways trend, marked with red lines, and anticipated a bearish breakout from this formation. As of now, this bearish breakout is indeed unfolding.

The downward momentum is driven by a false breakout above the yellow resistance, marked with an orange color, and the breaking of the black uptrend line. This black line served as the foundation for the flag pattern, which the price is now breaching to the downside. Such a breakout from a flag pattern typically signals a sell. The target for this move is the green horizontal support around 1.117. The probability of reaching this target is quite high, given the current momentum.

Furthermore, it’s essential to monitor the price action closely. If the price sustains its position below the black uptrend line and the flag pattern, it reinforces the bearish outlook. Conversely, any reversal above these levels might indicate a potential correction or consolidation phase before any further significant moves.