Daily Chart Art – August 2, 2011

NZD/USD: 1-hour

NZD/USD 1-hour Chart

Phew! It looks like the Kiwi needed to catch its breath after its recent strong rallies. NZD/USD pulled back to the .8750 minor psychological level, which was near the 50% Fibonacci retracement level. If resistance turned support at that area holds, NZD/USD could resume its climb and go for yet another record high! But if .8750 breaks and NZD/USD falls below the 61.8% Fib, watch out for a drop until the next support area near .8650.

USD/CAD: 4-hour

USD/CAD 4-hour Chart

Is USD/CAD forming a new range? After breaking below support at .9600 a couple of weeks ago, the pair found support at the .9450 minor psychological level. Price bounced a couple of times from this area and is currently testing support turned resistance at .9600. With that bearish divergence and stochastic pointing down, USD/CAD might drop and make another test of .9450. Make sure you check the 9 Rules for Trading Divergences if you plan to jump in a short USD/CAD trade!

AUD/JPY: Daily

AUD/JPY Daily Chart

Anyone else keeping a close eye on the AUD/JPY descending triangle on the daily time frame? I’m pretty sure Cyclopip‘s got his one good eye locked on this pair! Support at the bottom of the triangle, which is right at the 84.50 level, seems to be holding for now. But if that level breaks, the pair could slide all the way down to the 80.00 handle. From what I learned in the School of Pipsology, the size of the breakout is usually the same as the height of the formation. In AUD/JPY’s case, it’s roughly 500 pips. So if it breaks to the upside, it might be headed for the 90.00 mark.

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!

  • Sajitrade

    Hi,
    I have a question for you, how do you scan for trade opportunities?

  • raul

    what are your settings for stochastic?
    thanks