Trend traders huddle up! EUR/NZD has just bounced from the 1.5550 levels and is now headed for a rising channel support. Watch out for the 1.5400 major psychological level though, as it’s sitting near the 50% Fib, 100 and 200 SMAs, and the mid-channel support on the 1-hour time frame. Shorting at the mid-channel area could give you a decent trade especially if you think that the euro would go back to its previous highs against the Kiwi. Of course, you could always wait for the pair to drop back to its 1.5300 channel support levels if you think that the euro bears ain’t done shorting the common currency just yet.
Who’s up for a range trade? I hope you are because this setup is too good to miss! EUR/USD has just bounced from the 1.1275 levels, an area that has served as resistance since the start of the month. What’s more, a bearish divergence is making itself known on the 4-hour time frame. Shorting at current levels could still give you a good reward-to-risk ratio especially if you aim for the 1.1150 range support. Just keep close tabs on this one in case the euro bears run out of steam around the 1.1200 mid-range levels!
If currency cross trading is more your thing, then you should check out NZD/CHF’s potential support-turned-resistance situation. The pair has tested the .7000 major psychological handle after breaking below a rising channel, but is now on its way to the .7100 – .7150 retracement levels. What makes the area interesting is that it also lines up with the 50% – 61.8% Fibs as well as the SMAs and a falling trend line resistance on the 4-hour time frame. Think the Kiwi will bounce lower once it reaches the resistance 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.