Consolidation is the name of the game for EUR/USD! As you can see on the pair’s 4-hour forex chart, price has formed lower highs and higher lows, creating a symmetrical triangle chart pattern. Right now, the pair is testing the top of the triangle while stochastic is moving down from the overbought zone. This could mean that there’s enough selling pressure to push EUR/USD back to the bottom of the triangle. If you’re planning on shorting, make sure you set your stop above the triangle resistance!
Bounce or break? NZD/USD is approaching a key support zone near the .8500 major psychological level while stochastic is indicating oversold conditions. Take note that this is an area of interest which has acted as resistance in the past, which means that plenty of traders have their eyes locked on this level. A bounce could take the pair back to the .8650 minor psychological resistance while a breakdown could be a sign that a longer-term downtrend is in the cards.
Here’s a shorter-term forex setup for the day traders out there! EUR/GBP is still on a solid downtrend, as the pair gears up to test the top of the falling channel on its 1-hour time frame. Stochastic is already in the overbought region and ready to head lower, suggesting that EUR/GBP might do the same. If the channel resistance holds, price might make its way back to the channel support around the .8200 major psychological level.
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.