Daily Chart Art – May 2, 2016

GBP/CHF: 4-hour

GBP/CHF: 4-hour Forex Chart

GBP/CHF: 4-hour Forex Chart

Trend traders huddle up! After breaking above a falling channel and encountering resistance at the 1.4200 levels, GBP/CHF looks like it’s about to hit a retracement at the 1.3850 area. What makes this setup interesting is that the minor psychological handle lines up with not only the broken channel but also the 50% Fibonacci and the 100 and 200 SMAs. Think the pound will sink to 1.3850 before going back up? Read up on trading trends with Fibonacci retracements if you haven’t done it yet!

USD/JPY: Daily

USD/JPY: Daily Forex Chart

USD/JPY: Daily Forex Chart

I know y’all are watching USD/JPY’s fast descent, so here’s a chart for ya. The pair has fallen sharply last week and has finally broken below its March lows. The next possible support is at the 105.50 area, which has served as support in September 2014 and resistance back in January 2014. Be careful in trading this one though. Aside from the usual yen-related volatility, we could also be looking at the start of a bigger downtrend. You might want to wait for a couple of hesitation candles around the level before you buy the dollar against the yen. Make sure you write your contingency plans in your journals!

EUR/GBP: Daily

EUR/GBP: Daily Forex Chart

EUR/GBP: Daily Forex Chart

Here’s another one for the trend warriors out there! EUR/GBP has just bounced from the .7750 levels, which had lined up with a rising trend line on the daily time frame. This time stochastic is also on the bulls’ side with an oversold signal. Think the euro is about to knock the pound lower in the next few days? A long trade at the current levels could get you a good reward-to-risk ratio if you aim for the previous highs. Just make sure you place your stop losses well below the trend line and the 100 SMA!

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.