Let’s start off with a lil’ somethin’ for the pound bears! GBP/JPY had just been rejected at 169.50, an area that had served as a support back in February. Not only that, but Stochastic has also just left the overbought territory! A wide stop loss above the resistance zone could get you a good trade if you think that the pair is on its way to its new weekly lows. On the other hand, you could also wait for a break below the 167.50 region if you’re not too sure about shorting the Sterling.
Not a fan of selling the pound? No problem! Cable is currently testing a rising trend line support that hasn’t been broken since Q3 2013. What sweetens this setup is a 100 SMA support on the daily chart. Be careful in shorting this one, as Stochastic hasn’t left the oversold zone just yet and so far I’m not seeing reversal candlesticks in favor of the pound. You could buy small positions now and add as the pair pops higher but you could also wait until the pair actually bounces off the trend line before you enter a long trade.
From exactly a month ago GBP/NZD has fallen by a ridiculous 930 pips. 930 PIPS!!! I would think twice before jumping on the bandwagon though, since the pair is now being supported by a rising channel on the daily chart. What’s more, Stochastic looks like it’s about to leave the oversold area. You could enter a long trade on a bounce or try a short position on a break of the long-term support. Which direction do you think this pair is headed anyway?
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.