First up, let’s start with an update on Cable. The pair has been on a nice bullish run to start 2011, but it seems to have run into resistance at 1.6250. It now seems that bearish divergence is forming, with a shooting star forming as well. Could this be a top for GBP/USD and will pound bulls have their hearts broken this Valentines? Watch out for a bullish marubozu that closes above 1.6250 as a sign that bulls are pushing the pound higher. On the other hand, a bearish marubozu with a close below the 1.6000 handle may be a sign that the bears are taking control.
Check out USD/CHF struttin’ a sexy pair of double bottoms on the daily chart! Siiizzlin’ eh? According to the School of Pipsology, a double bottom pattern is an indication of a trend reversal. So you may want to be on your toes for a strong break above the neckline at around .9750 as this could be a sign that USD/CHF will reach parity again! Just don’t get too excited. If resistance at that level holds, we may just see the pair tumble to its lows at around .9340.
“Euro are you going down, down, in an earlier round..” Oops, pardon my singing. I just couldn’t help but break out into a Fall Out Boy tune after seeing what looks like a head and shoulders pattern on EUR/USD. Look at that! Doesn’t it make you want to sing too? Ha! Anyway, if the pair manages to convincingly close below the neckline support at around 1.3570, there’s a chance that the euro could go down swingin’ all the way to 1.3400. However, if there are enough buyers left chillin’ in the market, EUR/USD could skyrocket past 1.3850! With that said, I think it may be best for you to be patient and wait for confirmation before you bet your pips on this one.