First up, here’s a simple trend play on EUR/CHF’s 1-hour forex time frame. Price has been moving inside a rising channel since the start of the month and is currently testing the support around the 100 SMA and just above the 1.0950 minor psychological mark. A bounce might take place since stochastic is starting to move out of the oversold area, hinting at a potential return in buying pressure soon. In that case, the pair could move back up to the top of the channel around the 1.1050-1.1100 levels to test the resistance. Take note that the 100 SMA is above the longer-term 200 SMA, which means that the uptrend is likely to carry on. A break below the channel support and 200 SMA, however, might be a sign that a reversal is looming.
Looking for a breakout play? This one on USD/CAD might be ripe for the picking soon! The pair has been consolidating inside a symmetrical triangle pattern, forming higher lows and lower highs on its 1-hour forex chart. For now, the moving averages are crossing back and forth, showing that price could keep moving sideways. Meanwhile, stochastic is moving down from the overbought area, suggesting that further gains are possible. If selling pressure is strong enough, a downside break from the triangle support around the 1.3200 levels might take place and push USD/CAD lower by around 300 pips or the same height as the triangle. Similarly, an upside break past the 1.3300 resistance could spur a 300-pip rally. Better be ready in case this pair finally picks a direction!
Lastly, here’s a potential reversal setup on GBP/AUD’s 4-hour forex time frame. The pair has formed a double top pattern, indicating that the recent uptrend might soon be over. Price has yet to test the neckline of the formation around the 2.1400 major psychological support before confirming that a downtrend is about to take place. This might take some time to materialize since stochastic is nearing the oversold area while the 100 SMA is safely above the 200 SMA, both suggesting that further gains are possible. After all, the 2.1400 area previously served as resistance and might now hold as support. In that case, GBP/AUD could bounce back to the previous highs around the 2.2100 major psychological mark.
Forex Chart Settings:
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.