Looks like parity held pretty nicely on the Aussie yesterday. The question is though, for how long? For those of you who are looking to get in on a retracement, try popping up the Fibonacci tool on the 4-hour chart of AUD/USD. The pair is currently finding resistance at the 38.2% Fib level, but with Stochastic yet to hit overbought conditions, you may wanna chill out for a bit and wait for a test of the higher Fib levels before going short.
No sir, you aren’t seeing double! That’s actually a chart of NZD/USD! Just like its comdoll sibling, the Kiwi has retraced a bit after diving 800 pips from its highs last week. At the moment, the pair has found resistance at the 50.0% FIbonacci level, which happens to lineup with the psychologically round .8400 level. Stochastic ain’t quite in overbought territory yet, so you might wanna wait for a crossover or for another reversal candlestick before establishing a short position on the Kiwi.
Now if you’re a contrarian, you might wanna take a look at EUR/CHF. Yes, this bad boy has been on ridiculous downtrend, and has lost about 2000 pips in the past month! However, there are some signs that the downtrend may be coming to an end. First, a hammer has formed, indicating that buyers are strengthening their positions. Secondly, regular bullish divergence has formed, with price forming lower lows and Stochastic showing higher lows. Time to buy perhaps?
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. Check him out, playas!