Look at that! EUR/GBP's downtrend still seems to be very much intact as the long-term falling trend line has been holding steadily on the 4-hour chart. After that sharp decline from the .8100 handle, EUR/GBP pulled up for some air. If price heads back to test the falling trend line, the bears could jump in again and force the pair to resume its downtrend!
While the major currency pairs have been strongly trending, AUD/CAD has been ranging heavily. It has been bouncing around a horizontal channel with resistance at 1.0100 and support at parity. If you're looking to range trade this pair, then wait for price to retest the upper and lower boundaries before attempting to jump in!
For those who just love trading those long-term reversals, then I've got something for you too... As you can see, the price action on the AUD/USD weekly chart is showing a very clear bullish divergence. It is also sitting at a major support level. Taken together, the signals seem to indicate that the pair could bounce soon. I'm not saying price will undoubtedly reverse though, but given these signals, it might be a good idea to keep a close eye on the pair!
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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- Daily Chart Art - May 21, 2012 21:25 20 May 2012