Is that a pullback I see? After hitting resistance at the 82.00 area, AUD/JPY looks set for the 81.00 handle. What makes it interesting is that it’s near a 50% Fib and 100 and 200 SMAs on the 1-hour time frame. Not only that, but the psychological level had also served as an area of interest in the past. Stochastic hasn’t reached the oversold region yet, so you’ll have time to draft your trading plans. Keep your stop losses loose, aight? Yen crosses like this one can get more volatile than the majors.
Next up is a nice and simple range play on EUR/GBP. After finding support at the mid-range levels near .7775, the pair looks like it’s headed for a retest of the .7845 range resistance. Take note that the bears have been defending the level since the start of the month. What do you think? Will the bulls manage to break past the barrier this time, or will the euro bears defend the level for another day? A long trade at current levels could work if you take profits at the resistance area. On the other hand, you could also wait for a resistance retest and short at the level if you’re one of them euro bears.
Breakout alert! EUR/JPY has been on a downtrend for the past couple of days and it doesn’t look like it’s taking a breather any time soon. Will this mean a downside breakout for the pair? EUR/JPY is currently testing the falling channel support on the daily chart while Stochastic is hanging at the oversold territory. Any hints of a bounce could push the pair back to the 125.50 levels while a break below the pattern could lead the pair to new lows. Be careful if you’re planning on buying at a support, folks. Countertrend trading is not for everyone!
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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.