Who’s up for a break-and-retest play? GBP/JPY recently broke past the resistance around the 179.00-180.00 psychological levels and zoomed up to a high of 181.75. After that, price retreated from its rally and is showing signs of a pullback to the Fib levels marked on the 1-hour forex chart. In particular, the 38.2% Fibonacci retracement level might hold as support since it lines up with the broken resistance level. Stochastic is already starting to move up from the oversold area, which means that pound bulls are ready to charge!
Here’s another potential pullback play, this time on USD/JPY’s 1-hour forex time frame. As I’ve showed y’all yesterday, the pair broke past the descending triangle resistance and confirmed its intention to head further north. Dollar bulls seem to be needing a bit more reinforcement though, as price seems to be pulling back for now. Stochastic seems to be hinting that buying momentum could resume soon, but a larger correction could last until the broken triangle resistance near the 118.00 major psychological support.
It seems a bit sketchy but that looks like a head and shoulders pattern on USD/CAD’s 1-hour forex chart. This suggests that the pair’s recent rallies might soon have a short-term reversal, as price is already testing the neckline of the pattern around the 1.2400 major psychological support level. Stochastic is pointing up though, which means that a bounce could still take place and take the pair back to the nearby resistance around 1.2600 or until the previous highs at 1.2800. Just watch out for a downside break because it might mean around 400 pips in losses for this one!
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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.