Let’s start with a short-term uptrend play on GBP?CAD. The pair is lollygagging at the 1.8550 area, which is right smack at a rising trend line and 200 SMA support on the 1-hour time frame. Not only that, but stochastic is also in the oversold territory. A long trade at current levels is a good idea if you think that the pair is headed for its previous highs. Of course, you could also wait for a break below the support levels and trade a downside breakout if you’re one of them pound bears.
Remember that Fib play that we looked at a couple of days back? Well, it looks like it’s still holding as support! The bears still can’t get past the 1.4450 psychological handle, which lines up with a 50% Fib and a pretty solid resistance level back in March. Will this translate to a bullish run for Cable? Read up on using Fibs to enter forex trades if you haven’t done it yet!
Here’s another one for trend traders out there! CHF/JPY is finding resistance at the 111.50 area, which is near a mid-channel and 100 SMA resistance on the 4-hour chart. A short trade at current levels could make for a decent trade if you place your stops above the channel and aim for the previous lows. Remember to keep your stops wide on yen crosses like this one!
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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.