Reversal alert! For the second time this month AUD/USD got rejected at the .7500 major psychological handle. What’s interesting about this setup is that it’s now forming what looks like a double top on the 4-hour time frame. Stochastic has just left the overbought area, so we might see a move to the “neckline” at .7300. Will the Aussie bears gain enough momentum for a double top breakout? Or will the bulls step in and regain their mojo? Keep close tabs on this one, folks!
USD/CAD is lollygagging at the 1.2800 major psychological handle, which lines up with a rising trend line support on the 4-hour chart. What’s more, stochastic has just left the oversold territory. Will this lead to more gains for the Greenback? A long trade at current levels could make for a good trade if you think that USD/CAD is headed for the 1.3150 highs. On the other hand, you could also wait for a break below the trend line if you’re one of them Loonie bulls. After all, not all ascending triangles break to the upside.
Here’s one for the trend warriors out there! AUD/CAD is testing the .9550 area, which lines up with a mid-channel support. In addition, the 100 SMA has also crossed above the 200 SMA on the 4-hour chart. If you’ve read the School of Pipsology, then you’ll know that a crossover usually (but not always!) signals a start of a new trend. Will AUD/CAD go on its merry way up? Or will the Aussie bears extend the retracement all the way to the channel support near the .9475 area?
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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.