Yo homies! Check out this potential retracement play on NZD/USD. After a couple of days of sliding down, the pair seems to be stalling at the .7800 area, which was a former resistance level. With stochastic in the oversold zone and ready to cross upwards, Kiwi bulls could bounce back to action. To top it off, the area of interest around .7800 is in the vicinity of the 50% and 61.8% Fibonacci retracement levels. If those levels hold, NZD/USD might be able to resume its rally. Otherwise, it could drop to the next support zone near .7700.
Now here’s a channel I’m sure Happy Pip is fond of watching. No, it ain’t the Lifestyle Channel – it’s the falling channel on USD/CAD! The pair is currently sitting at the top of the channel, still figuring out whether to head back down or to go for an upside breakout. Stochastic is in the overbought region, suggesting that the pair’s rally might be over. If that’s the case, watch out for a drop all the way down to the bottom of the channel.
Last but not least, here’s a longer-term setup on AUD/JPY. If you’re into trading breakouts, then this is the chart for you! The pair has been consolidating inside a symmetrical triangle for a quite a while now and seems ready to bust out. The question is: Which way will it go? Stochastic is in the overbought territory, hinting at a downside breakout. Then again, make sure you set your stops right in case it breaks out to the top!
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.