First up is a sweet trend play on Cable. The pair is lollygagging at the 1.5050 minor psychological handle, which right smack at a rising channel level on the 1-hour time frame. Not only that, but Stochastic is also chillin’ like a villain on the oversold territory. Is it time for the pair to bounce? A long trade at current levels could get you a good reward-to-risk ratio if you think that Cable would reach the channel resistance at 1.5300. If you’re one of them pound bears though, then you could also wait for a move lower and a downside breakout on the setup.
Here’s another one for the dollar warriors! USD/CHF found support from the .9800 handle and is now hitting the 200 SMA on the 1-hour chart. What makes this setup interesting is that Stochastic is also flashing an overbought signal. Think USD/CHF is in for another leg lower? Stops above the 200 SMA could get you decent pips if you think that the dollar will go back to its previous lows. Of course, you could also wait for an upside breakout if you’re one of them dollar bulls.
I spy with my blue, bedroom eyes a breakout in the making! EUR/AUD is currently lollygagging at the 1.5200 psychological handle, which is just above a rising trend line support and below the 1.5250 resistance that has been holding since the start of the month. Will we see an upside breakout soon? The 100 SMA is currently on the bulls’ side but, as the School of Pipsology tells us, an ascending triangle doesn’t always translate into an upside breakout. If you do decide to take this trade, then you better read up on trading breakouts and log in possible price action scenarios on your trading journals!
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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.