If you’re looking to buy more yen this week, then this one’s for you! USD/JPY is currently testing the 112.00 major psychological handle, which is just below a falling trend line and 100 SMA on the 1-hour time frame. Not only that, but Stochastic is also lollygagging at the overbought territory! Will the dollar incur more losses against the yen this week? A short trade at current levels is a good idea if you’re one of them yen bulls, but you could also wait for a break above the said resistance areas if you’re not too sure about selling the dollar just yet.
Talk about doing a 180! Remember that USD/CAD downtrend that we talked about yesterday? Well, it looks like the bulls may have a case goin’ for them after all. See, if you zoom in on the 1-hour chart we can see that the pair is starting to form a rising channel. In fact, the bears are currently struggling to break below the 1.3700 major psychological handle, which lines up with the rising channel support. In addition, Stochastic is currently on the bulls’ side with an oversold signal. A long trade at current levels could get you a good number of pips if you aim for the previous highs near 1.3850. Just make sure to keep your stop losses wide in case the pair is on a downtrend after all!
Last up for today is an easy peasy downtrend play on AUD/JPY. The yen cross just bounced from the 80.50 minor psychological handle, which is right smack at the falling channel line and 100 SMA on the 1-hour time frame. The fact that Stochastic is on the overbought region is also a cause for celebration for the bears. What do you think? Will the Aussie give up some more pips to the yen? Read up on trading trending markets if you haven’t tried it yet!
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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.