The tides are starting to shift, fellas! From a steady downtrend towards the end of May, USD/CHF seems ready to make a reversal. There’s an inverse head and shoulders pattern that just formed on its 4-hour time frame, suggesting that an uptrend could take place really soon. Of course the pair still has to break above the neckline before heading any higher. Take note that the pattern is approximately 200 pips in height, which means that the potential breakout could be of the same size.
If you’re looking for an opportunity to join the comdoll bandwagon, then this setup is for you! After falling by a ridiculous 300 pips last week, AUD/USD is taking a breather at the .9250 area. Watch out though, as it looks like it’s forming a bearish flag on the 1-hour chart. A stop just above the flag formation could still give you a good risk ratio if you think that the comdolls still have room to fall this week.
Aww, snap! It looks like EUR/GBP gave up a lot of its gains and is now testing a broken falling trend line for support. Will we see it bounce soon? Maybe. However, I wouldn’t jump to that conclusion just yet. Wait for strong bullish candlesticks to materialize above .8500 before considering going long. A break below the handle could mean that the pair might see a bigger drop.
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.