If you’re into trend trading, then this one’s for you! GBP/USD is testing the 1.3350 minor psychological handle, which is right smack at a mid-channel support AND 100 SMA. Not only that, but there’s also a bullish divergence making itself known on the 1-hour time frame. Will the signs lead to more gains for the pound? Buying at current levels is a good idea if you think that Cable will make new highs this week. Of course, you could also wait for a retest of the 1.3250 channel support if you think that forex bears ain’t done with the pound just yet.
Dollar pairs not your thing? Check this out! GBP/JPY is having trouble breaking below the 135.75 levels, which lines up with not only the 50% Fib retracement and rising channel support, but also the 200 SMA on the 1-hour chart. Stops just below said support levels could get you a good reward-to-risk ratio especially if you’re betting on Guppy revisiting its previous highs. Just make sure you practice good risk management if you’re taking this one (or any other trades, actually).
After breaking below an ascending triangle last week, EUR/AUD looks set for another breakout. This time it’s lollygagging inside what looks like a symmetrical triangle on the 1-hour time frame. Heck, it’s even looking like a bearish pennant from over here! A break lower could take the euro to new lows against the Aussie, while a break higher could take it back to the 1.4800 area of interest. Watch this one closely, will ya?
Forex Chart Settings:
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.