Check out this trifecta of support levels on USD/JPY’s 1-hour forex chart! The pair seems to have bounced off the 100 SMA, which lines up with the 38.2% Fibonacci retracement level and the rising trend line connecting the latest lows. At the same time, stochastic is headed north, indicating that there’s enough buying momentum to take USD/JPY back to its previous highs near the 108.50 minor psychological resistance and beyond. If the pair still pulls back a little more, it could find support at the 61.8% Fib, which coincides with the 200 SMA and the 107.00 major psychological mark.
Euro bears, watch out! A forex reversal chart pattern just formed on EUR/JPY’s 4-hour time frame, suggesting that the recent selloff might be over. The pair is currently stalling around the neckline of the formation around the 137.00 major psychological resistance while stochastic is on its way down, which means that buyers are still hesitating to push the pair any higher. An convincing break past 137.00 might confirm that an uptrend is in the cards and that EUR/JPY might be in for a couple of hundred pips in gains, which is the same height as the chart pattern.
Divergence alert! CAD/JPY has been making higher lows inside an ascending trend channel that’s beginning to form on its 1-hour forex chart while stochastic drew lower lows, creating a bullish divergence. Price is already finding support at the bottom of the rising channel near the 96.00 major psychological support and might be ready to climb back to the channel resistance near the 97.00 handle. Stochastic is already moving out of the oversold area, which means that Loonie bulls are getting stronger. Just make sure you set your stop below the channel support if you’re thinking of going long.
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.