Daily Chart Art – May 10, 2011

USD/CHF: 4-hour

USD/CHF 4-hour Chart

If you’re a fan of the Fibonacci tool, then this update is for you! As you can see, USD/CHF has retraced half of its recent down move. With the pair able to hold below both the 50% Fibonacci retracement level and the .8800 major psychological handle, could it mean that the traders are starting to jump back in the overall downtrend? That seems to be the case, so look for price to retest the former low just around the .8550 region!

NZD/USD: 4-hour

NZD/USD 4-hour Chart

Will you look at that homie! It seems that we’ve got a very similar setup on NZD/USD! The only difference is that the resistance at the 50% Fibonacci retracement level is even more reliable as it coincides with a previously broken support. With price unable to close above the support-turned-resistance level, it looks like we could see the pair sell-off again and test the most recent low at .7820.

USD/CAD: 1-hour

USD/CAD 1-hour Chart

I feel that something’s going to burst, and I’m not talking about my bladder! If you look at the hourly chart of USD/CAD, you will see that its trading range is getting tighter and tighter as it consolidates into a clear symmetrical triangle. Symmetrical triangles, unlike flags and pennants, are bilateral in nature, which means they can breakout either way. If you’re part of the bull camp, look for a candle close above the .9700 handle to confirm your view. On the other hand, if you’re bearish on the pair, a close below the rising trend line support is what you’re looking for!

Before you get carried away with all these chart patterns and candlesticks, 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, Forex Gump fills us in on what we need to know about fundamentals with his Piponomics. Check him out, playas!

  • X-Forex

    I guess USD/CAD likely to break to the upside because CME raise the margin requirement thus negative for oil???

    • huck

      Forgive me for being a noob, but what does that mean X-forex? Hah!

      • HarryPilgrim

        It looks like a transaction cost of dealing in oil, as far as I can make out. I think the idea of the rise in the margin is to reduce price volatility. I doubt it would influence price levels.

        http://blogs.forbes.com/afonte