We spoke / analysed some days ago this cadchf currency pair on the daily chart.
We mentioned a short move down from resistance at number 6 but aknowledged that is was a counter trend move.
If in a counter trend then the moves tend to go against the direction of the trend and might be therefore shorter moves.
Todays candle did not close yet but we can see that price is at support and over the 50 day moving average.
Price has been providing us so far since January higher highs and higher lows.
That is why I personally prefer to be a bull buying at areas of support like at number 7.
To bullish engulfing candle reinforces my bullish bias.
Once I have established my trade idea I try to look for clues to confirm my opinion.
If a bull then I look to buy low. The stochastic indicator on the 1 hour is in overbought territory so I wait for a pullback.
Price action wise I am waiting for a double bottom or a bullish 123 pattern where I may ride the stochastic cycle upwards.
Ideally I want to buy at the yellow zone to have the best possible risk to reward.
The zone is nothing more or less then the area of support.
Best of Pips