Daily Chart Art – January 27, 2014

USD/JPY: Daily

usdjpy

When will USD/JPY’s selloff end? A look at the daily chart suggests that the pair is on its way to testing the broken resistance area around 100.00 to 101.00, which happens to be right in between the 38.2% and 50% Fibonacci retracement levels. Stochastic is still making its way towards the oversold region, hinting that bears could push the pair a little lower before an actual bounce takes place.

GBP/USD: 4-hour

gbpusd

Here’s an update on the GBP/USD ascending channel setup I showed y’all a few days back! GBP/USD just turned after reaching the channel resistance and is on its way back down. The pair is currently stalling at the middle of the channel but might soon test the bottom around the 1.6400 major psychological level before climbing again. Make sure you wait for stochastic to turn from the oversold region before hopping in a long trade though!

USD/CHF: Daily

usdchf

More losses for USD/CHF? The pair recently broke below the neckline of the double top pattern on its 4-hour time frame, indicating that the selloff could go deeper, possibly until the next established support level around the .8850 mark. Take note that the pattern is roughly 150 pips in height, which suggests that the resulting decline could be of the same size. Be careful since stochastic is in the oversold region already!

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.

  • Chuks

    Looks to have ended imo. I prefer to play the yens on gbpjpy though and am now long once more! Once usdjpy can maintain 102.30 level, I believe the sell off is done. Looks that it’s after today’s close that we will know with more certainty. h4’s though look enticing for them mighty bulls. Boy usdchf is good. nice spot!

    • Big Pippin

      Thanks bud.

      I guess USDJPY also needs to break above 103 before we see significant upswings. Right now it’s finding resistance at a broken rising trend line on the 1-hour chart. But that’s a different TF lol.

  • Shakapips

    Hey big pimpin, ive been folowing your charts for some time, and i just finished the School, now regarding how you chart Divergences, i’m confused about your way and the rule in the divergences lessons witch says something about drawing the lines between two clear highs or low, but i see you usually ignore the bumps in your lines (you draw along the price not lows ?)

    Did i missunderstand the lessons about the rules about divergences?

    Please help man

    Thanks.

    • Big Pippin

      Congrats on finishing the School!

      Can you link me to a previous post so I can see the lines again? In any case, divergences are usually considered as guides rather than absolute signals. Rather like seeing a puddle of water before you see a “slippery when wet” sign.