Here’s a quick update on the AUD/USD retracement play on the pair’s 4-hour forex time frame! Price has just bounced off the rising trend line and the 200 SMA, as it also found support at the 50% Fibonacci retracement level. Stochastic is still moving higher, suggesting that Aussie bulls are in control at the moment. A strong rally could take AUD/USD up to its previous month highs near the .9500 major psychological resistance, but a small pullback might take place once stochastic turns from the overbought area.
Are you a fan of range setups? If so, then you should keep your eyes glued to NZD/USD’s 4-hour forex chart. The pair is already approaching a key resistance level right around the .8700 major psychological mark. At the same time, stochastic is moving in the overbought zone, ready to head lower. If .8700 holds as a ceiling for the price rallies, the pair could soon find itself moving towards the bottom of the range, which is just above the .8500 major psychological support.
If shorter-term plays are your thing, then this one’s just for you! On its 1-hour forex chart, CAD/JPY has just formed a double top pattern, which is a classic forex reversal signal. The pair is still testing the neckline at the moment but a breakdown could mean a 50-pip drop, which is the same height as the chart pattern. Be careful since stochastic is already in the oversold zone, indicating that a bounce might take place 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.