GBPCHF has been traded in the 1.259-1.279 range for the past two months and by now has shaped a rectangle. Yesterday the price closed a bit above the upper boundary of the figure. Is that a fake breakout? Or the pair is going to continue its movement upwards?
In cases when the price approaches boundaries of a rectangle, Elder suggests referring to volumes. He believes that breakouts of rectangles’ boundaries can happen when volumes are rising. But the volumes observed started to fall when reaching the upper boundary.
Recommendations: today let’s wait for the breakout to verify itself and then buy it with the target of 1.3014. Or, in a case when the price gets back within the rectangle, sell with the target of 1.2595.