It looks like EURUSD’s downtrend is still intact since it’s still stuck under that falling trend line connecting the pair’s lower highs. But is that an inverse head and shoulders formation I see? That could signal that the pair’s downtrend is about to reverse! The stochastics are still climbing, which means that there’s enough buying pressure to take the pair higher. But before moving in an uptrend, it has yet to break above the neckline, which is closely in line with the 38.2% Fibonacci retracement level and the falling trend line resistance.
Here’s an update on GBPUSD… That rising channel I showed you a few days ago is still holding up! The pair bounced up and down inside the channel as it found support at the 1.4900 handle. From there, it broke one psychological level after another before pausing at the 1.5200 mark, which coincides with the top of the channel. Where could it be headed next? With the stochastics still aiming higher, those long green candles seem to indicate that buying pressure is very strong. Ooh, could this mean that GBPUSD is in for an upside breakout? If it breaks above the top of the channel, it could pause at the next psychological level, which is at 1.5300. But if sellers take over, the pair could sink back to the bottom of the channel.
Lastly, lets end with a look at the Swissy. I’ve popped on the daily chart and what do I see? A very bearish red candle! Price is now at the 1.0600 handle but is now fast approaching a key support level at 1.0515. If we see a daily candle close below this support level, look out! This may be a sign that the strong down move will continue before taking a break at 1.0140, a former low.