Missed the breakout party on guppy? Don’t you fret! You might still have a chance to hop in if the pair makes a pullback to that former resistance level, just around the 144.50 minor psychological mark. Now that area could act as support later on since it’s also close to the 38.2% Fibonacci retracement level. Pretty neat, huh? Just make sure you keep a close eye on stochastic because it’s still pointing down from the overbought region at the moment.
Heads up! A potential reversal could be in the cards for the Kiwi as a doji formed really close to the .8450 minor psychological level, which has acted as strong resistance in the past. Could this be a sign that Kiwi bulls aren’t quite ready to take the pair to new highs? Stochastic seems to be confirming this potential selloff as it is currently hovering around the overbought zone. Better wait for the next candle to close below the doji’s low if you’re planning to short!
Here’s another potential retracement play. AUD/JPY just made a break above the 96.00 major psychological level last week, but it appears that the pair’s rally is running out of steam. Stochastic is deep in the overbought area, suggesting that Aussie bears could take control in a while. If that’s the case, the pair could pullback until the 50% Fib, which is in line with a resistance-turned-support level. Watch out for a possible bounce around 38.2% level also since it’s in line with an area of interest.
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.