Now that’s what I call a rally! EUR/JPY is now up about 600 pips from yesterday’s lows. But what’s this? On the 4-hour timeframe we see that price is actually testing a falling trendline. If you think there aren’t enough bulls left to fuel the euro’s rally, this might be your chance to short. Just remember not to get too excited and wait for reversal signals first. A strong close above 125.00 could mean that there’s still room for the pair to move up to 127.00.
Oooh la la! Check out Cable on the hourly timeframe, folks! Price has now stalled right below the rising trend line that previously provided it with support. The question now is, will it serve as resistance? I would wait for a strong bearish candlestick first before jumping to that conclusion. Heck, I wouldn’t want to get wiped out should the pair continue skyrocketing!
Remember the setup I pointed out on USD/CHF yesterday? Well, both the bottom and the top of the falling channel were tested. Now, the pair is hovering around a significant support level around .9400. Keep tabs on the handle, will ya? A convincing break below it could mean that the pair is on its way down to .9200 while a bunch of reversal candlesticks could hint at a bounce back up to .9500.
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.