If you’re a huge fan of breakout setups, then this chart is for you! GBP/JPY has been forming lower highs and finding support around the 131.75 level, creating a descending triangle pattern on its 1-hour time frame. Stochastic is currently on middle ground, barely providing any clues on where this pair could go so a straddle play might be your best bet. Make sure you set your stops right if you plan to trade a breakout!
Lower lows on the price and higher lows on the oscillator… Why, that’s a bullish divergence right there! The recent Swissy rally might come to a halt if support at the .9250 minor psychological level holds once more. If you scroll back a little further, you’d notice that this level has held as strong support for the past three months! Don’t be shy to take a peek at your handy-dandy Divergence Cheat Sheet if you’re thinking of going long.
Last but certainly not least, here’s a potential break and retest play on AUD/USD’s 1-hour time frame. After breaking above the 1.0450 minor psychological resistance and coming close to the 1.0500 handle, AUD/USD seems ready to pull back as Aussie bulls try to gather more energy to push the pair higher. Stochastic is currently pointing down, suggesting that Aussie bears are in control at the moment and that they could push AUD/USD back down to resistance turned support around the 61.8% Fib.
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.