Brace yourselves, forex fellas! A huge correction might take place for GBP/NZD, as the pair is retreating from its recent rally. For now, it looks like the 38.2% Fibonacci retracement level is already holding as support while stochastic is starting to climb out of the oversold area. A bounce could take GBP/NZD up to its previous highs at the 2.1000 major psychological level while further declines could lead to a test of the lower Fib levels. In particular, the 61.8% Fib level might be the line in the sand for the selloff, as it lines up with the 2.0000 major psychological level and a former resistance zone.
Looks like CAD/JPY gotta bounce yo! The pair has been selling off in the past few weeks but it is already nearing a potential floor at the 50% Fibonacci retracement level. This lines up with an area of interest, as CAD/JPY previously found resistance at this region. Stochastic is still moving down, which indicates that there’s enough selling pressure left to push the pair to the 96.00 area. A bounce could take price up to the previous highs at 99.75 while a drop could lead to a test of the 95.50 minor psychological support near the 61.8% Fibonacci retracement level. Better wait for reversal candlesticks if you’re thinking of going long!
Check out the trifecta of resistance zones lining up on this bad boy! EUR/GBP has been steadily selling off but it looks like it could pull up to the .7900 major psychological level, which is around the 50% Fibonacci retracement level, falling trend line, and a broken support level. At the same time, stochastic is almost in the overbought area, suggesting that the downtrend could resume sooner or later. If that happens, EUR/GBP could fall back to its previous lows near .7750 or perhaps create new ones. Make sure you set your stop above the trend line or 61.8% Fib if you’re planning on catching the drop.
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.