Daily Chart Art – August 29, 2012

NZD/USD: 4-hour

NZD/USD 4-hour Chart

I can’t help but lick my chops whenever I peek at this setup on NZD/USD. It’s a double top formation in the works, and it’s as clean as they get, dawg! The neckline lies at .8050, which means that if price can close below this level, it could fall for another 150 pips (the height of the double top). Just make sure you don’t jump the gun and end up selling on a fakeout. Wait for a convincing break before you get short!

AUD/USD: 4-hour

AUD/USD 4-hour Chart

With AUD/USD’s long-term trend line finally breaking down, it seems as though we’re seeing the beginning of a new trend. If you want to get a piece of the AUD/USD sell-off, jumping in on a retracement at around 1.0430 might be your chance. It was once a formidable support and resistance level and it also falls within Fib territory, so other traders may be looking to sell in this area as well.

EUR/GBP: 1-hour

EUR/GBP 1-hour Chart

Last but not least, I present you this rising channel on EUR/GBP! As you can see, the top of the channel held like a boss yesterday, as it coincided with the .7950 minor psychological handle. If you’re a contrarian, you may want to consider selling the pair until it hits the bottom of the channel. But be careful! Countertrend plays such as this are risky. Be sure to practice smart risk management so your account doesn’t get burned!

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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