Yo! Let’s start this week’s intraday charts update with an old channel setup on EUR/AUD and a fresh head-and-shoulders pattern on EUR/NZD.
That there ascending channel on EUR/AUD’s 1-hour chart ain’t exactly new. If y’all can still recall, we first identified that there channel way back on October 18. And the last time we played it was during the October 25 intraday chart update from October 25.
Back then, the pair was about to test the channel’s resistance area at 1.5340, so we were waiting for an opportunity to go short on the pair so that we can then gun for the pair’s support area somewhere around 1.5100.
Well, check that out, dawg! That’s right. Resistance formed at 1.5340 and the pair went all the way down to 1.5100. So if you were gangsta enough to ride this pair, then congratulations on bagging some delicious pips. Aww, yea!
Anyhow, the channel is still intact, so today’s play is obviously to play the channel again. This time, however, we’ll be lookin’ for a chance to go long. And all the more so, given that the pair appears to be finding buyers again.
Do note, however, that there’s currently a higher-than-average chance for a downside channel breakout. After all, stochastic is already signaling overbought conditions and all that.
A break past 1.5030 would be an early sign that bears may be in control. But if the pair smashes past 1.4960, then y’all may wanna bail yo long if you still have ’em.
Is EUR/NZD gonna be moving even lower soon? Well, a head-and-shoulders pattern appears to be forming on the pair’s 1-hour chart, so there’s a good chance that the pair may do just that. After all, a head-and-shoulder is a bearish chart pattern.
The pattern hasn’t actually fully formed yet. But if the pair breaks that there rising trend line, than that may be an early sign that them bears are trying to complete the pattern.
However, the pair needs to break past 1.6850 in order to actually validate the pattern. Although y’all may wanna observe how the pair reacts to the area of interest at 1.6750 as well.
But if the pair clears 1.6750, then’s it’s very likely that them bears will be gunning for 1.6140 next, which is a whole lot of pips away.
Anyhow, just make sure to practice proper risk management like always, a’ight?