Yesterday EUR/USD went all Limp Bizkit and kept rollin’, rollin’, rollin’ down the charts after encountering resistance at the top of a channel on the 1-hour chart. Will the mid-channel support at the 1.3300 area hold or will we see the pair crash to the 1.3200 zone near the bottom of the channel? Keep a close eye on this one, brothas!
If you’re not in the mood to trade the euro today, then you could always look at USD/JPY, which is heading fast towards the 98.25 area. Not only has the zone served as previous resistance, but it’s also near the top of a descending channel. Stochastic hasn’t hit the overbought region yet though, so you might want to wait for candlesticks if you’re not convinced that the Greenback’s rally is about to end.
Last up for today is a possible support play on NZD/USD. After falling by 300 pips in less than three days, the pair looks like it’s about to hit a serious support zone. The .7800 handle is not only a major psychological area, but it’s also the bottom of a rising channel that’s been solid since mid-June. I’ll have to check with Pip Diddy for the fundies on this one, but I’m saying this is a pretty good technical bet if you know how to trade your channels!
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.