USDJPY has been inching up the charts after it found major support at the 84.00 handle. Does this mean the pair is in for some good lovin’ from buyers? Hmmm, that’s possible. But take note that this could also just be another retracement. If I were you, I’d keep tabs on the 61.8% Fibonacci retracement level (85.00) and see if it has turned into resistance. Oooh, and don’t forget that there’s also a possible bearish divergence with stochastics making higher highs while the pair is sportin’ lower highs.
After seeing the chart, you might be thinking that EURJPY has started to reverse its downtrend. Hah, don’t be a fool yo! EURJPY has formed the classic rising wedge pattern, which means that this rally we’re seeing could simply be a retracement and NOT a true reversal of the trend. Keep a close eye on the wedge support because a break in that level could lead to retest of former lows at 105.50.
Breakout or fakeout? It looks like buyers have managed to hustle GBPUSD above the ascending triangle. Yay! But wait! Stochastics indicates that the Pound’s rally could might already be losing steam. Boo! Drawing some a Fib on seems like the pair could just be – wait for it – retracing! I think I’m gonna wait for and see if GBPUSD trades past the 50% Fib at around 1.5500 or if gets rejected there.