First up for today is a little something for the yen traders. USD/JPY has just reached the 113.00 major psychological level, which is right smack at a rising channel support on the 1-hour time frame. What makes this setup interesting is that there’s also a small bullish divergence making itself known on the chart. Think the dollar is about to get some pips on the yen today? A long trade at current levels could get you a good reward-to-risk ratio if you aim for the channel’s resistance. Of course, you could also wait for a downside breakout if you think that the yen isn’t done gaining on the dollar just yet.
If you missed that resistance-turned-support opportunity that we looked at a couple of days back, then here’s another opportunity for ya! NZD/USD is back at the 76.50 areas, a level that has served as a solid resistance for the pair in February. This time around a 100 SMA is also throwing its support into the mix. A long trade at the minor psychological area could make for a good trade if you’re expecting the Kiwi to bounce against the dollar. Just make sure you leave enough room for volatility when trading non-major pairs like this!
Last up for today is another simple trend play, this time for long-term traders. EUR/AUD is testing a rising channel support around the 1.4700 major psychological areas. Not only that, but Stochastic is also in the oversold territory. Placing your stops below the trend line and aiming for the previous highs is a good idea if you’re one of them euro bulls. Then again, you could also wait for a downside break if you believe that the Aussie will strengthen against its counterparts like the euro.
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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.