Are euro bears ready to get back in the groove? EUR/JPY has been stalling around the 38.2% Fibonacci retracement level of the latest drop on its 4-hour forex chart, giving a chance for more sellers to hop in the ongoing downtrend. The Fib level even happens to line up with the 200 SMA and a broken support area, making it an even stronger resistance zone. Stochastic is almost in the oversold region though, which means that EUR/JPY might still bounce higher before resuming its selloff.
Breakdown alert! After days of consolidating inside a rectangle pattern, USD/CHF has finally made a break for it and is heading south. Stochastic is indicating oversold conditions though, which means that there could be a chance that this is just a fake out. In that case, USD/CHF might still make another run for the top of the range. On the other hand, if this breakdown signals that more losses are in the cards, USD/CHF might pull up for a quick retest of the broken support before edging lower.
Here’s another potential break-and-retest play that you wouldn’t want to miss! NZD/USD just made a strong break above the resistance at the .8700 major psychological level and surged to a high of .8737. With stochastic deep in the overbought region though, Kiwi bulls might need to take a break before charging again. The 38.2% Fib level lines up with the broken resistance and might act as support, before NZD/USD makes its way back to the recent highs or makes new ones!
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.