Daily Chart Art – August 28, 2009

USDJPY: 4-hour

PoD Chart

I’m spotting a descending channel formation on the USDJPY 4-hour chart. This pair has been on a downtrend for the past three weeks and it could continue to slide down. However, the stochastic is trying to climb out of the oversold area, suggesting that the pair’s next move could be upwards. The pair could hit the top of the descending channel, which is right around the psychological resistance level at 94.00, before heading lower. There’s also the chance that the pair could pierce through the top of the channel and move all the way up.

USDCAD: 4-hour

PoD Chart

Oh, looks like the USDCAD pair is coming along nicely, respecting technical levels quite well. Notice how price retested the broken rising trend line around 1.1000 before promptly dropping back down! Interesting. Though, price action seems to have stalled at the 61.8% Fibonacci retracement level as buyers and sellers battle it out to determine the pair’s direction. If buyers prevail, there would probably a lot of sellers waiting at this week’s high at 1.1000. On the other hand, if sellers take control, the pair’s next downside targets would be last week’s low at 1.0760.

GBPUSD: 1-hour

PoD Chart

A 60-minute chart of GBP/USD is shown above. The support at 1.6200 was able to put a halt on the pair’s downward momentum after it fell in an almost vertical fashion. The pair consolidated for awhile and for a time it seemed like it was going to break cleanly below 1.6200. Luckily for those who had long positions, the support held and the buyers were able to push the price all the way to 1.6300. Currently, the pair is trading just below this level. If it fails to move above 1.6300, then it may fall back again to 1.6200. On the other hand, it can reach 1.6400 if it is able to power its way through 1.6300.

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