First on today’s canvas is my favorite setup of all time: the break and retest situation! After breaking below that support area around the 171.50 minor psychological level and consolidating for quite some time, GBP/JPY is now starting to pull back and retest the broken support zone, which is in line with the 61.8% Fib. This might act as resistance for the pair’s rallies, as stochastic is already indicating overbought conditions. A selloff from this area could take GBP/JPY back down to its previous lows at the 170.00 area.
Don’t look now but AUD/NZD just bounced off the top of the symmetrical triangle on its 4-hour forex time frame! The pair is showing selling momentum and may be headed for the bottom of the triangle around the 1.0650 to 1.0700 psychological levels. Be careful though, as stochastic is moving out of the oversold region and seems to be hinting at a quick rally. In that case, AUD/NZD could make its way back to the top of the triangle and test resistance once more.
Last but not least is a simple support play on NZD/USD. The pair is currently testing the floor near the .8550 minor psychological level, which appears to be holding like a boss at the moment. Stochastic has just crawled out of the oversold zone, indicating that a bounce is in the cards. NZD/USD might head up by a hundred pips or so, just until the next visible resistance area near the .8650 mark. A stronger rally could push the pair up to those previous highs above .8750.
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.