Descending Channel on EUR/CHF Daily Chart

You can see a case of a rather uneven descending channel of the daily chart of EUR/CHF as of now. The channel takes its start following September’s peak, which marked the end of the 5-month bullish wave. The channel here represents a correction following an uptrend. Traders can use the upside breakout as a continuation signal. The only disadvantage in this specific pattern is the rate concentration near the upper border.
The channel itself is marked with the yellow lines on the screenshot below. The cyan line serves as the breakout entry — it is located at 10% of the channel’s height above the border. The green line is my declining take-profit level — it is placed at 100% of the channel’s height above the border. I will use the breakout bar’s low for a stop-loss. In case the breakout bar is mostly outside the channel, I will use the preceding bar’s low. I do not recommend trading a bearish breakout from the descending channel. You can click on the image to see a bigger chart:

I detected this channel using the Channel Pattern Detector indicator and built this chart using the Channel Pattern Detector indicator. You can download my MetaTrader 4 chart template for this EUR/CHF pattern. You can trade it using my free Chart Pattern Helper EA.
Update 2015-11-19 15:54 GMT: Long entry triggered at 1.08985 three hours ago. The stop-loss is set to today’s low at 1.08599, which quite tight. The current take-profit is at 1.10454, which is quite far but will be going down each day. The breakout bar looks modest — yesterday’s bullish bar would present a much more interesting entry signal:

Update 2015-11-20 7:45 GMT: Exited by stop-loss at 1.08599 at 4:21 GMT today. The breakout turned out to be false:


If you have any questions or comments regarding this descending channel on EUR/CHF chart, please feel free to submit them via the form below.