Daily Chart Art – May 31, 2010

EURUSD: 4-hour

PoD Chart

Let’s begin this week with a look on the EURUSD. Unlike in the past couple of weeks, the EURUSD failed to create a significant “lower low” last week. As a result, the pair formed a chart pattern called a “descending triangle.” Generally, a descending triangle is a bearish pattern but, in reality, it can break out either way. In this case, a break of support will open the way for 1.2000 for the bears. On the other hand, a candle close above the falling trend will pave the way for 1.2500 for the bulls.

AUDUSD: 4-hour

PoD Chart

Has the AUDUSD finally found a floor? I don’t know for certain, but unless price creates a new major low, I’m sticking with this view! As you can see, the pair managed to bust out of its double bottom chart pattern last week and soared all the way to 0.8550. It looks like the pair is starting to pullback now, possibly to retest the broken neck line and the 38.2% Fibonacci retracement level.

GBPJPY: 4-hour

PoD Chart

Now that the GBPJPY bounced from the 50.0% Fibonacci retracement level from its slow move up, it looks like the pair is in for another round of losses. Will we see it retest strong support at 128.00? Well, that seems to be the bias for now as stochastics is pointing down and 133.00 was kept intact by the bears. Watch out for a break of today’s low, as that can accelerate the pair’s move down!