Is EUR/AUD done retracing? On the 4-hour time frame, it looks like the pair is already finding resistance at the 38.2% Fibonacci retracement level but it may have room to pull up a little higher. After all, stochastic is still moving towards the overbought zone and has yet to cross down. In addition, the 50% Fib lines up with a former support level, which means that it could act as resistance moving forward.
Happy Pip seems to be on to something with her GBP/AUD trade idea this week! Not only has pair retraced to the area of interest she pointed out, it has also formed a bearish divergence! Stochastic hasn’t moved out of the overbought region just yet though, so make sure you check if this setup fulfills the 9 Rules for Trading Divergences if you plan to short.
Here’s another potential trend play that’s worth keeping on your watch list. EUR/GBP seems to be forming a falling channel on its 4-hour time frame as the pair grinds lower on its downtrend. It is stuck in the middle of the channel at the moment though and might ready to make a test of the bottom, as stochastic just reflected overbought conditions. If support holds, the pair could be on its way back to the channel resistance sooner or later!
To get the complete picture and avoid getting blindsided by economic data, you also have to do your fundamental analysis.
Lucky for us, Pip Diddy fills us in on what we need to know about fundamentals with his Daily Forex Fundamentals.