Isn’t that a thing of beauty? GBP/USD’s price action seems to be stuck within a clear horizontal channel as it has found resistance at 1.5880 and support around 1.5800. I don’t know about you, but it looks like price is going to test the support again. With the Stochastic showing that conditions are oversold, we could see the buyers take control of the pair again and keep 1.5800 intact. If you’re bullish on the pair, watch the 1.5800 area carefully for a possible entry point.
With the formation of spinning tops at the .8400 handle, it looks like EUR/GBP’s rally has run out of steam. In fact, the Stochastic has been moving above the 80.00 level for quite some time now, indicating that conditions are deeply overbought. Is it time for a reversal? Perhaps… but as the FX-men always says, nothing is ever certain in the forex market and anything can happen!
Is that a doji at a major support level? Why, yes it is! After 3 straight days of selling-off, the bulls and the bears have come to a standoff. For now, 1.4700 will hold, as no new “lower low” has been made. I don’t know exactly what’s going to happen next, but given the oversold Stochastic, we may see at least a slight pull back soon.
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.