Daily Chart Art – February 3, 2012

EUR/USD: 1-hour

EUR/USD 1-hour Chart

Will EUR/USD stay inside its range this NFP Friday? The pair just retreated from its rally after hitting resistance at the 1.3200 major psychological handle and seems to be aiming for the resistance turned support level at 1.3050. Stochastic is currently on middle ground but pointing downwards, suggesting that euro bears have the upper hand. If the pair manages to break below support at 1.3050, it could be headed for the 1.2950 minor psychological support next.

EUR/JPY: 1-hour

EUR/JPY 1-hour Chart

Higher lows and lower highs on EUR/JPY… Aha! That’s a symmetrical triangle right there! Could it make a breakout anytime soon? Possibly. But which direction is it likely to go? All those BOJ intervention rumors hitting the newswires hint that the path of least resistance is upwards, but the downbeat situation in the euro zone could keep weighing this pair down. If you’re planning to wait for a breakout either way, make sure you review the School of Pipsology lesson on trading breakouts!

EUR/GBP: 4-hour

EUR/GBP 4-hour Chart

Slow and steady does it! EUR/GBP has been on a shallow uptrend lately as it has been climbing inside a rising channel on its 4-hour time frame. The pair just hit resistance at the top of the channel, which was near the .8400 handle, early this week before plummeting to the bottom around .8300. Will the bottom of the channel hold as support or will it give way? Stochastic is pointing upwards, which suggests that the pair could bounce. Don’t forget to set your stops properly if you’re playing this range!

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.

  • Bob

    On the 1st Feb, you ‘spotted’ a head and shoulder and predicted a sharp drop. Instead the pair rocketed back to 1.32. Now you are saying it will range and the pair likely to fall back to 1.31 .What I do not understand is how is it that the formation cannot be interpreted as a “reverse” head and shoulder” in this 1 hr hour chart?
    You guys (Here in babypips)seems to placed a lot of emphasis on the euro woes but never talk about the possibility of a QE3 for the USD???