Intraday Forex Charts Update – May 12, 2016

AUD/JPY: 1-Hour

AUD/JPY: 1-Hour Forex Chart

AUD/JPY: 1-Hour Forex Chart

Reversal alert! An inverse head-and-shoulders is beginning to form on AUD/JPY’s, which may mean that forex traders who are bullish on the pair may be gearing up for an upside past the neckline at 80.70. If the the chart pattern is validated, then the pair may move higher for 240 pip, based on the height of the chart pattern. Stochastic is already indicating overbought conditions, though, so there’s a chance that price will move lower and invalidated tha pattern.

EUR/AUD: 1-Hour

EUR/AUD: 1-Hour Forex Chart

EUR/AUD: 1-Hour Forex Chart

EUR/AUD has been in a strong uptrend since late April, but it seems to have encountered some resistance at 1.5580 (dashed line). The bulls aren’t giving up, however, and they keep trying move past resistance while forming higher lows, consolidating into an ascending triangle in the process. An ascending triangle is a bullish continuation pattern, so our main directional bias is to the upside, although there’s always a chance that the pair will break lower instead. Anyhow, the pattern is about 360 pips tall, so a breakout could potentially have enough momentum to move for the same amount.

AUD/USD: 1-Hour

AUD/USD: 1-Hour Forex Chart

AUD/USD: 1-Hour Forex Chart

AUD/USD has been trading sideways while respecting resistance at 0.7390 and support at 0.7320, thereby giving us a tight 70-pip trading range or rectangle pattern to play with. Price is currently making its way back up to potentially test resistance, so get ready if you’re looking to trade the range by shorting at the resistance area. There is a chance that the pair will move lower or even break out to the downside, though, since the 100 SMA seems to be acting as dynamic resistance.

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.