First off, let’s start with a simple trend play on USD/CHF. The pair has been moving inside a rising channel on its 1-hour forex time frame, and it appears to have already bounced close to the bottom. Stochastic is crawling out of the oversold area, suggesting that dollar bulls are about to take control and push USD/CHF back to the top of the channel around the .9000 major psychological resistance. Make sure you set your stop below the channel support if you’re planning on going long!
Breakout! EUR/JPY has been in a strong downtrend for most of May but it appears that a reversal is in the cards. The pair made a double bottom formation, indicating that buying pressure has weakened towards the end of the month, and has even broken above the pattern’s neckline. EUR/JPY might climb by at least a 100 pips, which is the same height as the formation, but be careful since stochastic is already in the overbought zone.
Here’s one for the swing traders out there! NZD/USD has been selling off lately, but the pair might soon be relieved to find support around the .8400 major psychological level. This is in line with the 50% Fibonacci retracement level and a former resistance area, which also happens to be close to the 200 SMA. Stochastic is indicating deeply oversold conditions, which means that Kiwi bulls could charge sooner or later.
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.