Oh yeah! It looks like the euro was able to sustain its rally against the yen above 130.00. If you missed out on the move, don’t worry! Using the Fibonacci retracement tool, it looks like the pair could pullback to the 38.2% Fibonacci level and test a previous support/resistance area. Reversal candlesticks around 103.30 could mean that euro bulls would soon hustle all the way up to 104.00. Don’t get too excited though! A strong break below the level could mean that EUR/JPY is on its way down to 102.50.
Heads up! Cable is testing its former resistance levels! The pair is not only dilly-dallying at its former resistance at 1.6140, but it has also been making higher highs while Stochastic is making lower highs. Yep, that’s a bearish divergence, folks! A stop loss above 1.6150 presents a good risk ratio if you’re planning to short the pair.
A descending trend line connecting the pair’s major highs and an ascending trend line joining its swing lows… Why, that’s a symmetrical triangle forming on AUD/USD’s 4-hour chart! Will the pair keep bouncing up and down inside the triangle or will we see a breakout soon? If you’re part of the bull camp, look for a convincing close above the major 1.0400 psychological handle to confirm your bias. On the other hand, if you’re bearish on the pair, a close below 1.0350 is what you’re looking for. Good luck!
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.