First up, here’s EUR/USD testing resistance at the falling trend line. What say you, bro? You think the trend line will hold and price would soon drop back down to 1.3350? Or do you think there are still enough bulls to push the pair back up to 1.3600? If you ask me, I think I’d rather wait for candlestick confirmation first before pulling the trigger.
Hold up! Is my ‘fro just gettin’ in the way of my vision, or is that a potential head and shoulders chart pattern I see forming on the 4-hour chart of EUR/JPY? I would keep tabs around the 124.00 handle if I were you. A break of what could be the neckline support could send the pair plunging all the way down to 117.00. However, a bullish candle around the area and a break of the most recent highs above 126.80 could hint a run up to 130.00. So be careful!
If you’re a fan of Fibonacci plays, have I got the setup for you! After sliding below 1.5600 yesterday, it seems that GBP/USD has found its way back up to the 38.2% Fib level around 1.5670. Stochastic seems to suggest that we’ll soon see the sell-off continue though. Take note that it’s sporting a bearish divergence, making higher highs while price is making lower highs. Just don’t get too excited shorting the pair. A strong break above the 38.2% Fib level could mean that price would trade all the way up to 1.5770.
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.