Daily Chart Art – April 16, 2010

GBPJPY: 1-hour

PoD Chart

It looks like a rising wedge pattern has nicely formed on the GBPJPY hourly chart. Notice how the trading range of the pair is starting to get tighter and tighter. Sooner or later, price will have no where to go and a breakout will happen. Because a rising wedge pattern is considered to be a bearish pattern, watch carefully if the ascending trend line support holds. If an hourly candle closes below support, we could see the pair fall towards the most recent major low around the 142.00-142.10 region.

EURGBP: 1-hour

PoD Chart

After days of trading in a range, the EURGBP broke out downwards yesterday. With stochastics showing upward momentum and price bee lining towards the 50% Fibonacci retracement level, could we see the bears start jumping in? Watch that 0.8800 handle carefully, as we could see a lot of bears waiting to sell the pair at that psychologically significant price.

EURJPY: 1-hour

PoD Chart

After closing the weekend gap and bouncing up, the EURJPY pair formed a double top on the 1-hour chart. Yesterday, the price action dropped, breaking through the neckline support and zoomed all the way down to cover the gap once again! Will support at 125.75 hold? If the pair fails to break support, we could be seeing some ranging take place and buyers may push price back up to test highs at 127.70. On the other hand, if selling pressure is strong, price could drop to test the 125.00 handle – a former area of interest – and possibly to as low as 123.50.