Tired of shorting the euro yet? EUR/USD is having trouble breaking below the 1.3500 psychological handle. This isn’t surprising given that it’s also near a 50% Fib, rising trend line, and a former support and resistance area. If you’re one of them euro bulls, then you can wait for a couple more candlesticks to confirm a trend line bounce before jumping in. If you’re still short on the euro though, then you can also wait for buyers give up the major support area.
Trend continuation alert! NZD/USD just bounced off what looks like a mid-channel support on the daily chart. If you believe that the Kiwi isn’t done strengthening for the year, then you could probably use a stop below the mid-channel support and jump in with a long. Watch out for the .8400 area though. We could still see a head and shoulders action if the sellers manage to hold the fort at the resistance level!
Last up for the day is a simple support and resistance play on GBP/AUD. The pair is currently testing the 1.6900 area, which has served as solid support and resistance levels on the daily chart. And get this – Stochastic has also just left the overbought zone! A stop loss just above last week’s highs could get you a sweet risk ratio if you think that this pair will continue to head south.
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.