Daily Forex Chart Art – Oct. 12, 2015

GBP/NZD: 1-hour

GBP/NZD 1-hour Forex Chart

GBP/NZD 1-hour Forex Chart

Think the trend is your friend? Then you gotta take a look at this steady downtrend goin’ on in GBP/NZD’s 1-hour forex time frame! A descending trend line can be drawn to connect the recent highs of price action, and this might continue to hold as a ceiling while pound bears are on top of their game. This lines up with the 100 SMA, which has held as a dynamic resistance area and is below the 200 SMA, indicating that the selloff is likely to carry on. The pair seems to be pulling up from its latest dive, ready to make another test of the trend line around the 2.3000-2.3050 levels. If the trend line keeps gains in check, GBP/NZD could head back to the previous lows at 2.2820 or much lower. On the other hand, a break above the trend line could be a signal that a reversal is brewing.

USD/CHF: 1-hour

USD/CHF 1-hour Forex Chart

USD/CHF 1-hour Forex Chart

Anyone gutsy enough to take a countertrend play? Then lemme turn your attention to this channel bounce that might take place on the 1-hour forex chart of USD/CHF. The pair has been moving in a downtrend but is currently testing the bottom of the descending channel, which might hold as a floor and allow price to move back to the top at the .9700 major psychological mark. To sweeten the deal, price formed lower lows while stochastic made higher lows, creating a bullish divergence. If you’d rather go with the flow, you could wait for an actual test of the channel resistance near the moving averages. The 100 SMA is below the 200 SMA anyway, indicating that the path of least resistance is to the downside. Be on the lookout for potential reversal candlesticks around the mid-channel area of interest, too!

NZD/CAD: 4-hour

NZD/CAD 4-hour Forex Chart

NZD/CAD 4-hour Forex Chart

Waiting for a longer-term reversal? You gotta see this double bottom pattern forming on NZD/CAD’s 4-hour forex chart! The pair failed in its last two attempts to break below the .8300-.8350 levels, creating a reversal formation with a neckline around the .8800 major psychological mark. The 100 SMA just crossed above the longer-term 200 SMA, suggesting that Kiwi bulls are gaining traction and might be strong enough to push for an upside break. If so, NZD/CAD could climb by an additional 500 pips, which is roughly the same size as the chart formation. Stochastic is on the move down but is nearing the oversold zone so buyers could gain more momentum. However, if the neckline holds as strong resistance, another move back to the recent bottoms might be seen.

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.