Let’s kick things off with this sexy setup on GBP/USD. On the daily chart, we see that the pair is testing resistance at the 61.8% Fibonacci retracement level. Stochastic also shows a bearish divergence as it makes lower highs while price makes higher highs. Tempted to sell the pair? Be extra careful! Keep a close eye on the 1.5900 handle. A strong close above yesterday’s high around 1.5950 may mean that GBP/USD is on its way back up to 1.6300.
For those of y’all looking to sell the dollar, then you may want to look at NZD/USD. The daily chart shows an opposite setup to what I just pointed out on Cable. Price is now at the 38.2% Fib level, yesterday’s candle closed as a spinning top, and Stochastic indicates a bullish divergence. (It’s making lower lows while price is making higher lows.) Don’t get too excited buying the pair though! Who knows, there may still be enough bears in the market to push NZD/USD down to .7700.
If you’re looking for a day trade, trading GBP/JPY may just be for you! On the hourly timeframe, we see that the pair is now testing resistance at the top of the range. Will it hold? A bearish marubozu may signal that the pair is on its way back down to 123.80. However, a strong close above the week’s high around 125.00 could mean that GBP/JPY is about to rally to 125.85.
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.