Looks like EUR/GBP is gearing up for another trend line test! This falling resistance level has been holding since mid-March this year and might continue to keep the pair’s rallies at bay. The trend line coincides with the 100 SMA, which has been acting as dynamic resistance for the pair as well. Stochastic is already moving down from the overbought area, indicating that sellers are in control of price action at the moment. Still, EUR/GBP might have a chance at pulling up to the trend line near the .7950 area and possibly making new lows if the selloff continues.
And the Kiwi is back on its feet! It appears that the resistance turned support area around .8700 held for NZD/USD, as Happy Pip expected. After all, the area of interest lines up with the 38.2% Fibonacci retracement level and the 200 SMA. Stochastic is already reflecting a pickup in buying momentum, which slow down once the oscillator indicates overbought conditions. Further gains could take the pair up to its previous highs near .8830, but better be on the lookout for a potential reversal if the 100 SMA crosses below the 200 SMA!
Is the trend line bounce about to happen or what? GBP/USD is now moving closer to testing the resistance turned support zone at the 1.7000 major psychological level , which lines up with the rising trend line on the 4-hour forex chart and the 38.2% Fibonacci retracement level. To top it off, this potential support area also lines up with the 200 SMA. Stochastic is already moving higher, which means that buyers are starting to push the pair up, but a deeper retracement could lead to an actual trend line test before the pair makes new highs. Stay on your toes if a breakdown takes place though!
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.