Daily Chart Art – March 25, 2011

USD/CAD: 4-hour

USD/CAD 4-hour Chart

Is that a regular bullish divergence I am seeing on the 4-hour chart of USD/CAD? Why, yes it is! A regular bullish divergence is normally used as a possible sign for a trend reversal. In this case, the divergence could mean that the pair’s move down could be over and support at the .9750 region will hold strongly. Keep a close eye on price action folks…. We could see the bulls jump and and push the pair higher to the most recent swing high at .9830!

GBP/USD: 4-hour

GBP/USD 4-hour Chart

Woah! It looks like bears went as crazy as Chris Brown in selling the pound during yesterday’s trading, pushing GBP/USD down to the minor support level at 1.6100. But wait! Stochastic is already in the oversold area and is showing a hidden bullish divergence, making lower lows while price is making higher lows. Could it be the bulls’ turn to rally this time? Maybe. I wouldn’t get too excited yet though. A strong bearish candle below 1.6100 could mean that GBP/USD will tumble back down to the major support area at 1.6000.

EUR/GBP: 4-hour

EUR/GBP 4-hour Chart

Remember that rising trend line I pointed out on EUR/GBP a couple of days ago? Well, it looks like support held and the pair is now back up at the top of the rising channel at .8800! If you’re planning to short the pair, Stochastic being in the overbought turf my also tickle your fancy as this could signal that EUR/GBP is on its way back down. On the other hand, if you think bulls still have some muscle to hustle, watch out for a convincing break above .8800 because the pair could rally all the way to its most recent high at .8940!