More downside for the Kiwi? NZD/USD appears to have found resistance at the top of the falling trend channel on its 1-hour forex chart and might be headed for the channel support at the .7650 minor psychological mark. Stochastic is already indicating oversold conditions though, which suggests that Kiwi bears are feeling exhausted. If the mid-channel area of interest around the .7700 handle holds as support, the pair could make another test of the resistance and possibly go for a breakout! Make sure you review our lesson on Trading Breakouts if you’re taking that route.
AUD/USD seems to be hesitating on its recent climb, as the pair is pulling back to the broken neckline of the double bottom forex pattern on its 1-hour time frame. Price is finding support at the 50% Fib near the .8600 major psychological handle for now and stochastic is reflecting a pickup in buying momentum. This could be enough to take AUD/USD back to its previous highs near the .8700 handle or perhaps until the next visible resistance at the .8750 minor psychological mark. However, a break below the Fib levels might mean that sellers are still in control and that a test of the previous lows at .8550 is likely.
If you’re waiting to catch a breakout, then this CAD/JPY setup might be worth watching! The pair is forming a rising wedge on its 1-hour forex time frame and a test of support is bound to take place, as stochastic is moving south. A bounce off the 100.50 minor psychological support and wedge bottom might push CAD/JPY back to the top of the formation around the 101.50 level. A breakout in either direction might last by as much as 200 pips, which is the same height as the chart pattern, so y’all better keep close tabs on this pair in case it starts showing a directional bias!
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.