Well waddaya know! It seems the euro selloff has finally stalled! If you’re looking to jump on the bear bandwagon, you might just get your chance to do so if and when EUR/JPY retests the 50% Fibonacci retracement level. Sellers had a hard time pushing price across this area in the past, so it’s not unlikely that buyers will encounter the same difficulty.
This setup is for all of y’all who believe that the euro selloff is overdone! A little bit of chart art reveals that EUR/GBP has been trending up since the beginning of the year and a bullish divergence is in the works, too. If euro bears keep at it, price will meet the rising trend line soon, and that could provide much-needed support for the pair.
STOP… hammer time! Check out that beauty of a hammer that recently formed right above a former support level on AUD/JPY! Taken with the fact that Stochastic recently crawled out of oversold territory, this could be a sign that AUD/JPY is ready to post more gains. But just to be safe, it’s best to do a bit of currency correlation analysis and check out where AUD/USD and USD/JPY are headed.
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. Check him out, playas!