Daily Chart Art – September 23, 2011

USD/CAD: 4-hour

USD/CAD 4-hour Chart

Sometimes, when you’re dealing with market moves THIS strong, it’s better to go with the flow! What better way to do so than to catch the pair on a retracement! USD/CAD is now deep in bull territory, but it looks as though it may be gearing up for a pullback. If you want to catch it on the ride up, you may want to consider going long on one of the Fibonacci retracement levels. The 61.8% Fib looks most tempting because it lines up perfectly with parity. Of course, it’s always best to wait for confirmation from Stochastic and candlesticks before pulling the trigger. Good luck, playas!

EUR/GBP: Daily

EUR/GBP Daily Chart

If you’re a fan of channels, here’s a sweet setup on EUR/GBP! The pair has been trading within a descending channel for quite some time now, and is currently testing the falling resistance line. With Stochastic nearing overbought conditions, we may soon see selling pressure kick in. If you’re the patient type and want more confirmation, wait for a bearish reversal candle as a sign that the channel is intact and that the pair is headed lower!

EUR/CAD: Daily

EUR/CAD Daily Chart

Lastly, here’s another channel on EUR/CAD, but this time, it’s of the horizontal variety. This playa has been bouncing off support at 1.3450 and finding resistance just above 1.4300. With Stochastic still showing upward momentum, chances are that we’ll see the pair head up to test resistance at 1.4300. For now, it’d be best to sit on the sidelines and wait for a test of the support and resistance areas before establishing a position.

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. Check him out, playas!