Daily Chart Art – August 3, 2011

USD/CHF: 1-hour

USD/CHF 1-hour Chart

There ain’t no stopping the Swissy, huh? USD/CHF just broke through another set of support levels and reached a new record low of .7612. All that droppin’ low must’ve been really exhausting because the pair looks ready to pull back now. Stochastic is also pointing upwards, suggesting that Swissy bulls need a breather. USD/CHF could retrace until the 61.8% Fibonacci level, which is near a former support level. But if any of the Fib levels fail to act as resistance, it could mean that the Swissy’s rally is over!

EUR/USD: 4-hour

EUR/USD 4-hour Chart

Heads up! I’m seeing a head and shoulders pattern on EUR/USD’s 4-hour chart. By the looks of it, the pair is having trouble breaking below the neckline, which is around the 1.4200 major psychological handle. If that level breaks, the pair could drop by roughly 200 pips until 1.4000, which is approximately the same height as the chart formation. But, with stochastic already in the oversold area, euro bulls could jump back into action and take the pair back to the 1.4400 area.

GBP/JPY: Daily

GBP/JPY Daily Chart

Ooh, check out that neat long-legged doji on guppy’s daily chart! The reversal candlestick pattern formed right at the long-term support level at the 125.50 level. Could this mean that GBP/JPY is about to turn? If you’re a pound fan, it might be better to wait for the next candle to close above the doji’s high as confirmation. Take note that the pair has been forming lower highs lately, hinting that pound bears are trying harder and harder to break below 125.50.

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!