Here’s an update on the EUR/JPY forex chart I showed y’all yesterday. Price appears to be making that pullback I’ve talked about so I decided to whip out the handy-dandy Fib tool to see where price could retrace. The 50% Fib level appears to be in line with the broken trend line and might act as support, but price might bounce sooner or later as a bullish divergence has formed. See how stochastic made lower lows while price drew higher lows? This could be a sign that euro bulls are ready to charge and push the pair past its recent highs near 138.00!
Check out this strong EUR/AUD selloff! Price broke through another key support area recently, indicating that sellers are still very much in control for this pair. The pair recently bounced off support at the 1.4150 minor psychological level, suggesting that a correction might be in the cards. The Fib levels from the latest swing high and low show that the 61.8% Fib is in line with the broken support zone around 1.4720, which might act as resistance moving forward. Stochastic is already indicating overbought conditions though so a shallow retracement is also possible.
If you’re more into ranges, then you might find this setup to your liking. EUR/NZD appears to be moving sideways, as it found support around 1.5730 and resistance at 1.5870. Price is nearing the range resistance at the moment and might turn again, possibly making its way back down to the bottom of the range later on. At the same time, stochastic is almost in the overbought area, which means that euro bears could keep any rallies in check for now. If you’re thinking of shorting, make sure you set your stops above those previous spikes or beyond the 1.5900 major psychological mark.
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.