Who’s up for a break-and-retest play? After hitting a roadblock at 1.3800, EUR/USD is now back at the 1.3750 area. What makes this interesting is that the area had served as a strong resistance in the second half of February. Not only that, but Stochastic is also currently in the oversold region. Do you think it’s time for the euro bulls to step in or is the euro done rallying against the Greenback?
Breakout alert! On the 1-hour chart we can see that CAD/JPY had just broken above the 92.00 major psychological handle AND its falling channel pattern. Be careful about buying this one though, as there’s also a potential bearish divergence on the chart. You can place a tight stop below the channel resistance if you think that the Loonie is headed higher but you can also wait for a retest of the 92.00 area if you’re not too sure about buying the comdoll.
If trading EUR/USD is not your thing, then you can trade a similar setup on GBP/AUD. The pair had encountered resistance at the 1.8800 area and is now back at the 1.8550 zone. The level was a major inflection point back in February so we might see a bit of tug-of-pip around the area. Take note that Stochastic is about to hit oversold, which could be good for the pound bulls. Remember to keep your stop losses wide in case you’re planning to trade this currency cross pair!
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.