Daily Chart Art – May 31, 2012

GBP/USD: Daily

GBP/USD Daily Chart

Break alert! It appears that the Cable bears have managed to overpower the bulls as they finally broke through the very significant 1.5650 support. Will it continue to fall further? It looks like it, especially since Cable formed a very clear bearish marubozu! The next major support level is also still far away at 1.5275.

EUR/CAD: 4-hour

EUR/CAD 4-Hour Chart

I’m sure our one-eyed blogger here on BabyPips.com has his sights on this falling channel on the EUR/CAD cross! As you can see, the pair has been trading within a wide falling channel for quite a while now. Since the pair is about to test the bottom and the 1.2700 major psychological level, will we see a bounce? Well, we’ll just have to wait and see how price action pans out later!

USD/JPY: 4-hour

USD/JPY 4-Hour Chart

If you’re not into trading channels, then maybe this potential breakout play on USD/JPY can tickle your fancy. USD/JPY just formed a falling wedge, suggesting the pair could rally strongly soon. A falling wedge is normally seen as a reversal pattern since price tends to breakout to the upside after consolidating at the tip of the formation. If you’re looking to go long on USD/JPY, wait for price to trade above the pattern for confirmation!

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.