Daily Chart Art – November 8, 2012

GBP/USD: 4-hour

GBP/USD 4-Hour Chart

If you dig ’em ranges, then this setup could be for you! GBP/USD has been bouncing up and down between support around 1.5975 and resistance at 1.6150 on its 4-hour time frame. It’s currently sitting right at the bottom of the range, still unsure whether it’ll make a downside breakout or bounce right back up to the top. Stochastic is on middle ground at the moment so make sure you wait for confirmation signals before trading this one!

USD/JPY: Daily

USD/JPY Daily Chart

Higher highs on the price and lower highs on stochastic… Why, that’s a bearish divergence right there! USD/JPY seems to be exhausted with its recent rallies as it seems to be finding resistance at the 80.50 minor psychological level. If this pair heads further south, it could drop all the way down to the next potential support area near the 79.00 mark. Make sure you check out the 9 Rules for Trading Divergences before jumping in.

CAD/JPY: Daily

CAD/JPY Daily Chart

Now here’s a long-term channel that I’ve been watching for quite some time now. CAD/JPY has been steadily climbing inside a rising channel on its daily time frame and it just turned after recently hitting the top around the 81.00 major psychological resistance. Stochastic is still pointing down, hinting at further selling pressure, while the pair is right in the middle of the channel. Could this mean that Loonie bears could take CAD/JPY all the way down to the bottom of the channel at 79.50?

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.