Full Professional Analysis — CHF/USD (Swiss Franc vs U.S. Dollar) | Double Bottom Pattern Forming
1. Macro and Technical Context:
The CHF/USD currency pair had been in a sustained bearish trend leading into the current price action, creating a series of lower highs and lower lows — a textbook downtrend structure.
However, the momentum of selling pressure has been gradually weakening, as suggested by less aggressive sell-offs and price stabilization around a key psychological level — 1.2000.
This slowing momentum often precedes a reversal, which sets the stage for the appearance of the classic Double Bottom pattern, a strong bullish reversal indicator.
2. Pattern Breakdown:
Double Bottom Formation
First Bottom (Bottom 1):
Formed after a sharp sell-off.
Strong buyer interest emerged around the 1.2003 zone, creating an initial bounce.
Neckline (Resistance Zone):
The bounce met resistance at 1.2165 where sellers reappeared, but notably, the bounce indicated that bulls were stepping up.
Second Bottom (Bottom 2):
Price retraced again but failed to break the first bottom, creating a higher low wick rejection, confirming strong demand at support.
This validates the symmetry of the double bottom, which strengthens the pattern's reliability.
Key Note: The "Double Bottom" is only fully confirmed after a decisive breakout above the neckline resistance.
3. Trading Strategy Setup:
✅ Entry Plan:
Buy setup is activated only on a breakout and close above 1.2165.
Conservative traders may wait for a retest of the breakout zone before entering.
✅ Take Profit Levels (TP):
TP1: Initial profit booking at 1.2165 (breakout level) if retest holds.
TP2 (Main Target): Final target at 1.2213, which aligns with a previous resistance zone and measured move projection.
✅ Stop Loss (SL):
Safe stop loss below 1.2003, just under the support and second bottom.
This placement protects against false breakouts and pattern failures.
✅ Risk-Reward Ratio:
Favorable — approximately 1:2 or better, depending on entry execution.
4. Additional Technical Insights:
📈 Support & Resistance:
Support: 1.2003 (double bottom zone)
Resistance: 1.2165 (neckline), 1.2213 (target)
📉 Volume Analysis (Optional but Important):
Breakout volumes must ideally expand during the move above the neckline.
Higher volume confirms genuine breakout strength.
🔥 Pattern Psychology:
Sellers attempted to push the price lower twice but failed, resulting in a loss of bearish momentum.
Buyers are gaining confidence after successfully defending the same level twice, thus likely to dominate the next move.
5. Risk Management and Cautions:
Avoid jumping in prematurely before the breakout confirmation.
Always assess news events or macroeconomic factors impacting CHF or USD, especially around this pattern confirmation.
Partial profits could be booked at TP1 to lock in gains, and remaining position could be trailed to TP2.
🎯 Final Summary:
CHF/USD is presenting a strong bullish reversal opportunity through a textbook Double Bottom pattern.
Breakout above 1.2165 will likely trigger momentum towards the 1.2213 resistance target.
Risk management remains crucial: protect trades with a stop below 1.2003.
🛡️ "Patience on the breakout, discipline in execution, and precision in managing risk will define the success of this setup."
1. Macro and Technical Context:
The CHF/USD currency pair had been in a sustained bearish trend leading into the current price action, creating a series of lower highs and lower lows — a textbook downtrend structure.
However, the momentum of selling pressure has been gradually weakening, as suggested by less aggressive sell-offs and price stabilization around a key psychological level — 1.2000.
This slowing momentum often precedes a reversal, which sets the stage for the appearance of the classic Double Bottom pattern, a strong bullish reversal indicator.
2. Pattern Breakdown:
Double Bottom Formation
First Bottom (Bottom 1):
Formed after a sharp sell-off.
Strong buyer interest emerged around the 1.2003 zone, creating an initial bounce.
Neckline (Resistance Zone):
The bounce met resistance at 1.2165 where sellers reappeared, but notably, the bounce indicated that bulls were stepping up.
Second Bottom (Bottom 2):
Price retraced again but failed to break the first bottom, creating a higher low wick rejection, confirming strong demand at support.
This validates the symmetry of the double bottom, which strengthens the pattern's reliability.
Key Note: The "Double Bottom" is only fully confirmed after a decisive breakout above the neckline resistance.
3. Trading Strategy Setup:
✅ Entry Plan:
Buy setup is activated only on a breakout and close above 1.2165.
Conservative traders may wait for a retest of the breakout zone before entering.
✅ Take Profit Levels (TP):
TP1: Initial profit booking at 1.2165 (breakout level) if retest holds.
TP2 (Main Target): Final target at 1.2213, which aligns with a previous resistance zone and measured move projection.
✅ Stop Loss (SL):
Safe stop loss below 1.2003, just under the support and second bottom.
This placement protects against false breakouts and pattern failures.
✅ Risk-Reward Ratio:
Favorable — approximately 1:2 or better, depending on entry execution.
4. Additional Technical Insights:
📈 Support & Resistance:
Support: 1.2003 (double bottom zone)
Resistance: 1.2165 (neckline), 1.2213 (target)
📉 Volume Analysis (Optional but Important):
Breakout volumes must ideally expand during the move above the neckline.
Higher volume confirms genuine breakout strength.
🔥 Pattern Psychology:
Sellers attempted to push the price lower twice but failed, resulting in a loss of bearish momentum.
Buyers are gaining confidence after successfully defending the same level twice, thus likely to dominate the next move.
5. Risk Management and Cautions:
Avoid jumping in prematurely before the breakout confirmation.
Always assess news events or macroeconomic factors impacting CHF or USD, especially around this pattern confirmation.
Partial profits could be booked at TP1 to lock in gains, and remaining position could be trailed to TP2.
🎯 Final Summary:
CHF/USD is presenting a strong bullish reversal opportunity through a textbook Double Bottom pattern.
Breakout above 1.2165 will likely trigger momentum towards the 1.2213 resistance target.
Risk management remains crucial: protect trades with a stop below 1.2003.
🛡️ "Patience on the breakout, discipline in execution, and precision in managing risk will define the success of this setup."
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Related publications
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.