The ascending channel on NZD/USD’s 1-hour forex chart that we identified back on Tuesday was respected, so congratulations on your 140 pips if you were able to find a trade on that setup. And since the channel was respected, why not play it again? If life gives ya lemons, then go make a lemon-powered go-kart, right? Anyhow, price seems to be finding resistance at the top of the channel, so aggressive traders may already be looking for shorting opportunities already. But stochastic is pointing up again after briefly moving away from the overbought area, so be careful since forex traders who are bullish on the pair may not be out of steam just yet.
GBP/USD has been bouncing ever lower inside a massive descending channel that has been respected since mid-October. Presently, price just bounced off the top of the forex chart pattern and seems ready to make its way down again. Stochastic is also pointing down and moving away from overbought territory, so forex traders who are bearish on the pair may be in control already. Just note that the moving averages have recently crossed-over into uptrend mode, so there’s a chance that either moving average may act as dynamic support.
One of the most conservative ways to play an ascending channel is to look for support and buying opportunities near the bottom of the channel. Unfortunately, that’s not where price is currently at. Fortunately, price seems to be meeting some sellers at the mid-channel area and stochastic is already moving down and away from the overbought area, so we may get an opportunity to hop aboard soon. Do note that the moving averages have just crossed-over into a downtrend, so make sure to wait for support to form if you plan to go long near the bottom of the channel since there’s a small chance for a downside channel breakout. In any case, just make sure to practice proper risk management should you find a trade based on this or any of the other charts, alright?
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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