Look what we’ve got here! USD/CAD has been trading in a rising channel for the past few weeks. But after its most recent rally, it looks like the bulls’ rally is running out of steam… Or is it? Using the Fibonacci retracement tool, it seems that price could soon test the 61.8% Fib level which coincides nicely with the bottom of the channel. So keep tabs around the .9950 area! Reversal candles around the minor psychological handle could signal that the pair would soon be on its way back up to 1.0050 while a strong close below it could mean that USD/CAD would soon drop like a rock!
If you missed out on the move I pointed out earlier on USD/CHF (the one with the head and shoulders chart pattern), don’t worry, it looks like you can still jump in on the rally! Stochastic indicates that the pair is already oversold after it broke support around the neckline at .9400. The 38.2% Fib level aligns nicely with the previous neckline support which suggests that the pair could soon test the area for resistance. But don’t be too excited to short the pair just yet! Who knows, there may still be enough buyers in the market to push USD/CHF back up to .9500.
Finally, here’s Cable on the 4-hour timeframe for y’all! The pair has been slowly its losses for the past couple of days. But will it stop soon? If you think GBP/USD is about to trade lower, keep tabs on the Fib levels between 1.5950 and 1.6050 where the pair has previously found support. Reversal candlesticks around this area could mean that price would soon drop below 1.5850. On the other hand, be wary should a strong bullish candlestick materialize as it could hint that we’ll soon see GBP/USD trade around 1.6150.
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.