Daily Chart Art – October 28, 2010

EUR/USD: 4-hour

EUR/USD Chart

Let’s find out first how things are going with EUR/USD. The pair may have been on an uptrend for a long while now, but that head and shoulders formation on the 4-hour suggests that we could see a reversal soon. With neckline support at the 1.3750-1.3800 region being heavily tested like a college student, will we see a breakout? Hah, nobody knows for certain, so better be careful before putting on some longs! If we see a candle close below the 1.3700 handle, it would confirm the breakout and the pair could possibly fall to the next major psychological level at 1.3500.

EUR/JPY: 4-hour

EUR/JPY Chart

Now, let’s get the dilly on EUR/JPY. Aha! Is that a symmetrical triangle I see forming on the 4-hour chart? Well, the falling trend line which I pointed out a couple of days ago still looks good and support at 112.40 seems to have held making the pair sport higher lows. It might just be! Hmmm, the last two candlesticks, a hammer and and an inverted hammer, suggest that the bulls are revving up to test resistance at the top of the triangle at 113.00. If there are ‘nuf of them to reprezent, we may just see the pair hustle to the weekly highs, just below the 114.00 handle. On the other hand, if resistance at the top of the triangle holds, we may see EUR/JPY end up in the bear lair down at last week’s low at 111.60.

GBP/JPY: 4-hour

GBP/JPY Chart

Lastly, we have GBP/JPY which appears to be chillin’ at the top of a descending channel. Bummer for the bulls, it looks like resistance around 129.20 seems to have held the first time they gave it a shot. But will the second time be the charm for ‘em buyers? It could be, as it looks like GBP/JPY found support at 128.70. Just check out that spinning top and newly-formed inverted hammer yo! But don’t bet your bling-blings on the pound just yet. If resistance at the 129.00 handle holds, we could see the pair strut all the way down to the bottom of the channel.

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