After that steep dive below the 130.00 major psychological mark, EUR/JPY needed to pull up for some air. The pair appears ready to retrace to the Fib levels on the 1-hour time frame, as the 38.2% Fibonacci retracement level is in line with the former support area. Stochastic has already reached the overbought region but hasn’t crossed down yet, which suggests that EUR/JPY could still make a higher pullback, possibly until the 130.00 handle or 50% Fib level.
Looking to hop on that yen bandwagon? Look no further than this 1-hour chart on USD/JPY! After breaking through the trend line, the pair seems to be retracing back up a bit. Keep an eye out for the 38.2% Fib, as it lines up perfectly with a former support zone, as well as the falling trend line support. Sellers may be looking at this area to load up on their short positions!
Would ya look at that! EUR/AUD looks like it just closed below the neckline support of a head and shoulders pattern. Now, I know that this chart pattern is usually taken as a bearish signal, but you should be aware that price is about to test support around a rising trend line. If you plan on trading the pair, watch out for candlesticks around the 1.4650 area. Bullish candlesticks could hint that EUR/AUD is on its way back up to 1.5000 while bearish ones could signal a bigger sell-off!
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.