Confluence, baby! All these resistance levels lining up at the 1.5000 major psychological handle could make it a good spot to short EUR/CAD if you’re bearish on the euro. Not only does the round number line up with the 200 SMA, but it also is very close to the 50% Fibonacci retracement level and a former support area. Stochastic is already moving down from the overbought zone, indicating that bears are starting to take control of price action and might be eager to push the pair to its previous lows near 1.4750.
If you dig longer-term setups, then you might like this break-and-retest situation on EUR/JPY’s daily chart a little better. The pair seems to be finding resistance at the 38.2% Fibonacci retracement level but, with stochastic still moving higher, EUR/JPY could still retest the broken support at 140.00 or the 50% Fibonacci retracement level. A selloff from this area could take the pair back down to its former lows at the 138.00 major psychological support.
They say that breakouts are for the brave and if you’re one of those gutsy souls, then you should pay close attention to this EUR/AUD setup. The pair has been consolidating inside a triangle pattern on its 4-hour time frame and it appears that the range is getting tighter and tighter. This could mean that the battle between the bulls and bears is heating up, and that a breakout might take place pretty soon. Stochastic is moving down, which means that bears are in control at the moment but this might go either way!
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.