Is the Aussie selloff about to end? AUD/JPY is making its way towards the bottom of the rising channel on the 4-hour time frame and might be ready to bounce off support. After all, stochastic is already deep in the oversold zone, indicating that sellers are exhausted. If the channel support holds, the pair might climb back to the middle of the range around the 92.00 level or possibly the top of the channel at 93.00.
Lower highs and higher lows… Why, that’s a bearish divergence right there! USD/JPY looks poised for a deeper selloff after finding resistance around the 104.50 minor psychological level recently. The pair is currently finding support above the 104.00 mark, which has acted as an area of interest, but a breakdown could mean a dive back to the previous lows around 103.00.
If you’re a big fan of Fibonacci retracements, then this setup might be for you! After its recent sharp dive, CAD/JPY seems to be pulling up for air and getting ready to make a retest of the broken support level. This is right in between the 38.2% and 50% Fibonacci retracement levels, making it a pretty solid resistance area. Take note though that stochastic is crawling down from the overbought region already, which means that a selloff might take place earlier!
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.