How’s it hanging, EUR/USD? Ready to make a pullback there, old chap? It sure looks like EUR/USD is starting to retrace from its strong drop while stochastic is still climbing towards the overbought area. The pair could climb back to retest the broken rising trend line, possibly around the 50% retracement level. The 38.2% Fibonacci level could also serve as support-turned-resistance for the pair, before it resumes its drop. From there, EUR/USD could test its recent lows around 1.2875.
Are you ready to wish your pips on a shooting star? If you are, then you might want to check out cable on the 4-hour chart because it just formed one! Ha! I pointed out a falling trend line last Monday, but zooming out I saw that there’s another one that goes back to November 2010. And it looks like the pair is now testing it and the resistance 1.5600 handle. Stochastic seems like it’s hollering that sellers are getting ready to push GBP/USD down the charts being in the overbought turf. If this is the case, we may just see the pair fall to 1.5430. But you may want to wait for more candlesticks and read up on fundamentals before you root for the dollar. Who knows, bulls might still have something up their sleeves to hustle the pair all the way up to 1.5750!
And last but not least, get dibs on what looks like a bearish rectangle on EUR/GBP y’all! Did sellers just get a chill pill from their rally, or are buyers finally taking over of the pair? Well, if you’re planning to join the bear camp, be on your toes for a convincing break below the .8300 handle because EUR/GBP may just tumble down to .8250. On the other hand, if you’re bullish on the pair, watch out for a break above .8336!