Whoa! Is that a bearish divergence I see on the 4-hour chart of EUR/AUD? With price making lower highs and Stochastic making higher highs, it looks like it is! It seems to me that bulls are having a hard time pushing the pair past resistance at the 50% Fibonacci retracement level. If there isn’t enough euro lovin’ to go around, we may just see EUR/AUD tumble back down to its previous low around 1.3000. However, if you’re feeling bullish for the pair, stay on your toes for a strong break above the resistance area around 1.3220 as this may just signal that EUR/AUD is on its way back up to 1.3450.
Check out that support level on GBP/USD! It’s holding like a boss! As you can see, 1.5800 is a tried and tested support and resistance level. Will we see another bounce off this major psychological handle? Candlesticks seem to suggest it as a hammer recently formed above the said level. Stochastic also seems to be in agreement as it’s deep in oversold territory. If 1.5800 holds, price could find its way back up near 1.6500. But if it gives way, GBP/USD’s next destination could be all the way down below 1.5500.
Lastly, here’s a look at EUR/JPY! Over the past six months, the pair has been on a major downtrend. However, a hammer has formed on the daily chart, while Stochastic is crossing over from oversold territory. With the pair hitting majors lows, is this the end of the line? I’d wait for a bullish candle close today before placing my bet on this pair.
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!