Daily Chart Art – August 17, 2011

EUR/USD: 4-hour

EUR/USD 4-hour Chart

Oooh la la! Remember that setup I pointed out on EUR/USD last week? As it turns out, support at the rising trend line held and now the pair just bounced from resistance at the top of the triangle. With Stochastic already easing out of overbought conditions, will we see EUR/USD trade lower all the way down to the 1.4300 area? Maybe. Just watch out for signs of a reversal though. Who knows, there may still be enough bulls to push the pair back up to 1.4400.

USD/CAD: 1-hour

USD/CAD 1-hour Chart

For all you comdoll aficionados out there, dig this spankin’ setup on USD/CAD. With price making lower highs and finding support at the .9800 handle, it looks like the pair is sporting a descending triangle on the 1-hour timeframe. If you’re feeling bearish on the pair, watch out for a strong break below the .9800 psychological handle as this could mean that the pair is on its way down to test support around .9600. On the other hand, if you’re thinking of going long, it may be better to wait for the pair to close above yesterday’s high at .9880.

EUR/CHF: 4-hour

EURCHF 4-hour Chart

Now check out this bearish setup I spotted on EUR/CHF in the 4-hour timeframe. It seems like the pair is testing the previous support area around 1.1400. With Stochastic making lower highs while price is making higher highs, it looks like a bearish divergence has materialized. Does this mean the Swissy is going to resume its rally soon? Probably. However, I wouldn’t get too excited if I were you just yet. Be on your toes for bullish candlesticks as these could signal that the pair would rally back up to 1.1850.

Before you get carried away with all these chart patterns, remember that technical analysis is only half the story.

To get the complete picture and avoid getting blindsided by economic data, you also have to do your fundamental analysis.

Lucky for us, Pip Diddy fills us in on what we need to know about fundamentals with his Daily Forex Fundamentals. Check him out, playas!

  • Herbert

    I refer to your EUR/USD chart. You have both a down trend line for the resistance and a up trend line for the support drawn. It seems that you only blog about the pair when it touches the resistance and offer a take on shorting the pair but not when the pair  touches the support line?? I noticed many bloggers on Babypips are often talking about shorting a pair of currency but seldom discuss about buying (I may be wrong). Is this site only for bears only??