Daily Chart Art – August 5, 2009

USDJPY

PoD Chart

The USD/JPY has been bouncing up and down inside the ascending channel formed since July this year. The pair attempted to pierce through the bottom of the channel yesterday but failed miserably. It dipped to a low of 94.36 before jumping back in the range. As soon as it landed inside the channel, it continued to make further headway until 95.44. The stochastics oscillator is currently in the overbought area, which means that the price could slide lower. The pair could retest the bottom of the channel once again and make another attempt to break below it. But if the support at this area proves to be very strong, the pair could rebound upwards, possibly until the top of the channel.

EURJPY

PoD Chart

Just when it seemed that the JPY was going to make a nice run, technical levels held nicely, preventing the EURJPY from dropping any further. The 136.00 handle held strongly for the pair, which was also close to last week’s high. It seems that this price area is a resistance turned support area now. In addition, it also lined up nicely with the .500 Fibonacci retracement level. It’s possible that buyers were waiting there ready to pounce. For coming sessions, we could see price action test 138.00 if buyers still have enough momentum to bring it that high. If sellers try to make another move, we may see them try to break through the 136.00 area once again.

GBPUSD

PoD Chart

The GBP/USD pair is now on an uptrend after it broke up cleanly from a trading range. After rising by about 350 pips since it broke free from the ‘can,’ the pair is once again consolidating between 1.7000 and 1.6900. Is the pair just gathering momentum before springing up again? If this is the case, the pair’s next target is the 1.7100 level if it is able to close above 1.7000. On the other hand, the pair could fall down to 1.6800 or back to the uptrend line if the price breaks below 1.6900.

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