Look at USD/JPY stuck in a 100-pip range! The pair has been bouncing between support near 81.75 and resistance at 82.75 for more than a couple of weeks now. With stochastic still moving higher, it appears that USD/JPY is ready to test the top of the range once more. If the resistance holds, the pair could be headed back down to the bottom of the range. Make sure you wait for stochastic to reach the overbought area and cross downwards if you’re thinking of shorting this pair!
Aaah… Breakout! USD/CHF just busted above the .9300 major psychological level yesterday and topped at .9340. It seems that the pair is ready to pull back a bit, with stochastic waiting to move out of the overbought region. If that happens, USD/CHF could retrace to until the 61.8% Fib, which is in line with the broken resistance level. Watch out for a potential bounce from any of the Fibs though, as the rally seems to be really strong!
Here’s another break and retest setup on USD/CAD! The pair just dropped below the bottom of its 1-hour range then bounced from the .9900 area. From there, USD/CAD pulled back up to the former support at .9915, which could act as resistance now. Oh, and did I mention that it coincides with the 38.2% Fibonacci retracement level? Pretty neat, huh? Just make sure you wait for stochastic to reach the overbought zone before jumping in short!
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.