If you think the trend is your friend, you might wanna look at this rising trend line play on NZD/JPY’s 1-hour forex chart. The pair has been on an uptrend for the past few days and may be ready to resume its climb if the trend line, which lines up with the 50% Fibonacci retracement level, holds as support. In addition, stochastic made lower lows while price created higher lows, forming a bullish divergence and hinting at a potential rally. Better make sure that this setup meets the 9 Rules for Trading Divergences if you’re planning on catching a long trade.
If you’d rather trade reversals, then this double bottom chart pattern on EUR/NZD’s 4-hour forex time frame might be more interesting for you. The pair seems to be tired from its dive and may start heading back up, as price is approaching the neckline of the reversal formation. A break past the 1.4600 major psychological resistance could confirm the uptrend, which might last by around 300 pips. Stochastic is already close to the overbought region though, which suggests that the neckline could still hold as resistance and push EUR/NZD back to its previous lows at 1.4300.
And if you’re into range setups, you wouldn’t want to miss this potential long-term support bounce on GBP/NZD’s daily forex chart. The pair is sitting right at the bottom of its range at the 1.9400 major psychological level while stochastic is indicating oversold conditions, suggesting that support might hold. In that case, price could head back to the top of the range at the 2.0800 major psychological level or at least until the middle around the 2.0000-2.0100 area. Make sure you set those stops right in case a breakout takes place!
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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.