Daily Chart Art – April 18, 2011

USD/JPY: 4-hour

USD/JPY Chart

Here’s your chance to see another divergence action! On USD/JPY‘s 4-hour chart I’m seeing a sweet bearish divergence, but its impact is currently countered by other indicators. For one, the 83.00 handle has also served as a major resistance in the past. What’s more, Stochastic is also flashing an oversold signal! If you’re a fan of divergences you can probably wait for the pair to test the 38.2% Fib and the 82.00 support, but if you’re already seeing a red cape on this bullish setup then you can place your stop below the next possible support and aim for the previous high.

USD/CAD: 1-hour

USD/CAD Chart

It looks like USD/CAD has finally broken the rising channel on the 1-hour chart… or has it? After opening the week with a weekend gap below the channel, a couple of green candles popped up and suggested that the pair might at least retest the bottom of the channel. Stochastic is also on the bulls’ side for now as it chills in the oversold area, but we’ll never know when the bears are going to attack. The .9650 and .9700 are good targets for the bulls, while the bears might want to wait for a few more candles and see if the pair resists the previous support.

GBP/JPY: 4-hour

GBP/JPY Chart

Last on the board today is a potential Fib play on GBP/JPY. Though a bearish divergence showed up in the 4-hour chart, you might want to watch out for a potential support at the 135.00 handle. Aside from being a major psychological level, the area also lines up with the 50% Fib. And to top off the potential bull rally, Stochastic is also in the oversold region! A stop below the 50% Fib might be a sweet deal for the bulls, especially if you’re aiming for the 137.00 handle or even the previous high near 140.00.