Which way will EUR/USD go? The pair is currently testing the rising trend line on its 1-hour time frame, as euro bulls and bears could be battling it out. Stochastic is indicating oversold conditions though, which suggests that bears are already exhausted. A bounce could take the pair back up to its previous highs near the 1.4000 major psychological resistance while a breakdown might indicate that a longer-term selloff is in the cards. Make sure you review our lesson on trading breakouts if you’re thinking of shorting!
Here’s another bounce that might take place! NZD/USD is on its way to test the ascending trend line connecting the lows on its 1-hour chart. In addition, the rising support level is in line with the 0.8500 major psychological handle while stochastic has reached the oversold region. If the support area holds, NZD/USD might be on track to test the previous highs or even make new ones. Looks like Happy Pip still has a chance at hopping in this Kiwi uptrend!
If you’re a long-term trend trader, then you might like this USD/CHF setup a little better. The pair seems to be in the process of retracing to an area of interest around the .8900 major psychological resistance. This is somewhere between the 38.2% and 50% Fibonacci retracement levels on the 4-hour time frame and is also right around the falling trend line connecting the latest highs. Wait for stochastic to turn from the overbought region before shorting though!
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.