Check out this potential break-and-retest play on EUR/AUD! As you can see on the pair’s 4-hour forex time frame, price made a strong break below the 1.4400 major psychological support then dipped to a low of 1.4212 before bouncing back up. Price appears to be making its way back up to the broken support zone, which lines up with the 50% Fibonacci retracement level and might act as resistance moving forward. Stochastic has already reached the overbought zone, indicating that a selloff might take place soon.
Breakout alert! AUD/USD broke below the bottom of the ascending triangle pattern on its 4-hour forex time frame, suggesting that more losses could be in the cards for the pair. Take note that the chart formation is roughly 250 pips in height, which means that the resulting selloff could be of the same size. Be careful if you’re shorting though, as stochastic has already reached the oversold zone, with a small bullish divergence forming. A bounce could lead to a test of the broken triangle support before the pair heads any lower.
NZD/CHF looks ready to test the bottom of the rising trend channel on its 4-hour forex chart, as it recently edged below the mid-channel area of interest and showed more downside momentum. Price could find support at the .7650 minor psychological level and bounce back up to the middle of the channel around .7800. Stochastic is climbing out of the oversold zone already, which means that bulls could take control anytime soon. Make sure you set a wide stop below the channel support if you’re planning to go long!
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.