Daily Chart Art – July 9, 2012

AUD/USD: 4-hour

AUD/USD: 4-hour Chart

Heads up, forex fanatics! We’ve got a potential retracement play in the works on AUD/USD! Right now, the pair is finding support at the 38.2% Fibonacci retracement level, which just so happens to line up almost perfectly with a former resistance level and the 1.0200 major psychological handle. If you think AUD/USD is destined for new heights, you may want to consider going long, as Stochastic is already signaling oversold conditions. However, if you’re a member of the bear camp and think AUD/USD will continue falling, wait for the pair to break below 1.0200 before you load up on shorts!

GBP/USD: 1-hour

GBP/USD: 1-hour Chart

Welcome to GBP/USD a.k.a. bear town! This pair recently broke through the 1.5500 major support level, forming a solid downtrend in the process. If you’ve been looking for a chance to jump on the sellers’ bandwagon, you may get a chance to do so if price revisits the 1.5500 handle. But be careful! Stochastic just turned away from oversold territory, which means that selling pressure may die down soon.

GBP/JPY: 4-hour

GBP/JPY: 4-hour Chart

Last but not least is this finger-lickin’ good setup on GBP/JPY! Will it bounce or break at 123.00? A strong bounce off this level could lead to a rally to 125.00, near the pair’s recent highs. On the other hand, if this support zone breaks down, GBP/JPY may just continue falling all the way to around 122.00… or even back down to 119.00!

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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