Range traders, unite! NZD/USD looks ready to test the top of its range on the 4-hour forex time frame and may head back to the bottom if .7960 holds as resistance. Stochastic is still moving up, which means that Kiwi bulls are in control of price action for now. Sellers could take over once the indicator reaches the overbought level and push the pair down to support around .7720. If you’re thinking of playing this range by shorting at the top or waiting to go long at the bottom, make sure your stops are wide enough to withstand any potential spikes.
Think AUD/USD is about to reverse? I just saw a double bottom chart pattern forming on its 4-hour forex chart, which might be a sign that the recent selloff is almost over. Price has yet to break past the neckline of the reversal pattern around the .8800 major psychological resistance before confirming the potential climb. With stochastic making its way down from the overbought zone, Aussie bears might be revving up for another move lower. If bulls take control of price action though, a strong break past .8800 could lead to gains of as much as 250 pips, which is the same height as the chart formation.
Here’s another update on the USD/CAD channel I showed y’all last week! As anticipated, price did make its way back down from the channel resistance until the bottom around the 1.1200 major psychological support. Another channel bounce might be in the cards, as the support seems to be holding so far, although stochastic is still indicating a buildup in selling pressure. If USD/CAD resumes its climb, the pair could make its way back to the top of the range around the 1.1300 major psychological resistance. Be on the lookout for any signs of a breakdown, as the recent drop has been pretty steep!
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.