First up for the month is a simple resistance setup on EUR/USD‘s 4-hour chart. The euro bears might get a kick out of the bearish divergence, which is backed up by a potential resistance at the 1.2700 major psychological handle. A short position with a stop above last week’s highs would present a good risk ratio if you aim for the 1.2500 area.
Trend traders huddle up! If you haven’t erased Cable‘s rising trend line from last week, then you’ll know that it’s turning into a resistance line on the 4-hour chart. And get this – the potential resistance area is also near the 1.5700 handle while Stochastic is in the overbought zone! Be careful in shorting this one though. A break above 1.5700 could still push the pair all the way to the previous high near 1.5800.
If trading the scrilla is not your style, then you might want to take a look at AUD/JPY‘s rising channel action on the 4-hour chart. The pair seems to have hit a resistance near the 82.00 handle, which is right at the top of the channel. Oh, and Stochastic is in the overbought region too! Good luck trading this setup, brothas!
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.