Daily Forex Chart Art – Sept. 18, 2015

USD/JPY: 1-hour

USD/JPY 1-hour Forex Chart

USD/JPY 1-hour Forex Chart

Bounce or break? USD/JPY is currently testing the bottom of the symmetrical triangle visible on its 1-hour forex time frame, still deciding whether to head further south or to make another move to the top. Stochastic is suggesting that a bounce is possible since the oscillator seems to be turning higher from the oversold region. In that case, a climb to the 121.00 major psychological resistance might be in order. However, the moving averages appear to be making a downward crossover, hinting that a downside break might take place. If that happens, USD/JPY could fall by an additional 300 pips, which is roughly the same height as the triangle pattern.

GBP/JPY: 1-hour

GBP/JPY 1-hour Forex Chart

GBP/JPY 1-hour Forex Chart

Pound bears, watch out! Guppy could be in for a reversal from its downtrend, as the pair has formed an inverse head and shoulders pattern on its 1-hour forex chart. Price is currently testing the neckline around the 187.00 major psychological mark and might be due for an upside break. If that happens, the pair could be in for a 700-pip rally, which is around the same size as the chart formation. The 100 SMA is above the 200 SMA anyway so the path of least resistance is to the upside. Stochastic is already indicating overbought conditions though, which means that buyers are feeling exhausted and might allow sellers to take over from here. If so, GBP/JPY could head back to the nearby support at the 185.00 handle, which is near the 200 SMA.

EUR/JPY: 1-hour

EUR/JPY 1-hour Forex Chart

EUR/JPY 1-hour Forex Chart

Looks like an uptrend is brewing on EUR/JPY’s 1-hour forex chart! The recent lows can be connected by a rising trend line, and it seems that the pair is gearing up for another test of the ascending support area just above the 136.00 major psychological level. Stochastic is heading lower, reflecting a pickup in selling pressure, but a bounce might take place once it hits the oversold region. The 100 SMA is safely above the 200 SMA for now, which suggests that the longer-term climb is likely to carry on. If euro bears keep gaining strength, they could push for a downside break of the trend line and a reversal of the uptrend. Better wait for a long red candle to close below the 136.00 handle and 100 SMA before chalking it up as a breakdown!

Forex Chart Settings:

Slow Stochastic: 14,3,3
100 SMA: Blue line
200 SMA: Red line

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.

  • Cal Bachand

    Any thoughts on GBP/JPY now?