Daily Chart Art – August 2, 2012

USD/JPY: Daily

USD/JPY Daily Chart

Anyone notice that perfect bounce off 78.00 on USD/JPY yesterday? I sure did! As if Patrick Ewing was there to defend the level itself, price got rejected and formed a bullish candle on the daily chart. Seeing as this level was quite a tough nut to crack in previous times, it may be a while before sellers push price below this critical support zone. With the bulls seemingly in control, it may just be a matter of time before the market revisits the areas of interest around 79.00 and 80.00.

GBP/USD: 4-hour

GBP/USD 4-hour Chart

Remember that range that I pointed out on GBP/USD a couple of days ago? Well, its resistance held like a boss! Will support do the same? It’s only been two days since price touched the top of the 250-pip range and already it’s within striking distance of the range’s support. Keep a close eye around 1.5475 for signs of a possible reversal, homies!

AUD/USD: 4-hour

AUD/USD 4-hour Chart

AUD/USD has been enjoying a solid rally over the past few weeks, forming a clear rising channel. It recently formed a new high but now it looks as though it’s ready to hand control over to the bear camp. If you think this pair has topped out, you might want to consider trading the pair down to the bottom of the channel. On the other hand, if you’re not comfortable trading countertrend setups, just wait for the pair to pull back before establishing a long position. No matter what you decide to do, make sure to practice smart risk management!

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.

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