Daily Chart Art – February 29, 2012

USD/JPY: Daily

USD/JPY Daily Chart

Is it time for a retest? After breaking above the 79.50 area of interest and staging a strong rally, USD/JPY seems ready to pull back. Using the handy-dandy Fibonacci retracement tool, I noticed that the Fibs are nearly in line with major and minor psychological levels, which also acted as inflection points in the past. Pretty neat, huh? Stochastic is in the overbought area, suggesting that USD/JPY could retreat from its recent rallies so I’d keep my eyes on the Fib levels in case it bounces right back up.

AUD/JPY: 4-hour

AUD/JPY 4-hour Chart

AUD/JPY has been carefully crawling inside a rising channel for quite a while now as its uptrend remains strong. The pair just found support from the bottom of the channel and seems poised to head for the top while stochastic is still pointing upwards. The next area of resistance seems to be around the 88.00 major psychological level so watch out for any candlestick formations that could suggest a move back down.

GBP/JPY: 1-hour

GBP/JPY 1-hour Chart

Will guppy test its former highs near the 130.00 major psychological handle? The pair just found support at the 61.8% Fibonacci retracement level after a bullish divergence formed. Right now, it seems ready to resume its uptrend, possibly until its recent highs or beyond. Be mindful though that stochastic is already in the overbought region, which means that pound bulls might run out of steam pretty soon.

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.

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