Let’s start off with this retracement trade on the Greenback. As Huck pointed out in her trade idea, the pair just broke above the 1.0080 resistance, a level that has held since the start of the month. Right now it’s finding resistance just above the 1.0150 psychological level, which could pave the way for a retracement all the way to the broken resistance. A short at the level could be a good idea if you’re one of them dollar bulls, especially if you put your stop losses below the unbroken SMAs. On the other hand, you could also catch a few pips shorting at market and aiming for the previous resistance level. Just make sure you keep close tabs on your position and get ready for possible continuation of the trend!
Descending triangle alert! NZD/JPY is being held back by a falling trend line on the 1-hour time frame, which is near a 100 SMA resistance level. Not only that, but Stochastic is also on the bears’ side with its almost overbought signal. Meanwhile, the 79.65 support has remained intact for the week. Will we see a retest of the support area and a possible descending triangle breakout, or will the bulls have enough muscle in their hustle to push the pair above 80.00 and the SMA resistance levels?
Last one up for today is another potential breakout, this time on the Aussie. The pair is currently testing the 87.80 area, a resistance level that hasn’t been broken since late October. One look at the 4-hour chart also tells us that the bulls have been defending a rising trend line since the start of the month. Will this standoff lead to an upside breakout for the Aussie? If you’ve read the School of Pipsology, then you’ll know that triangle breakouts could be as volatile as the height of the triangle. This means a break above 88.00 could take AUD/JPY to 90.00 while a downside breakout could also take the pair back to its late October lows.
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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.