Eeenie meenie miney mo, which direction will EUR/GBP go? The pair is heading fast towards the .8400 major psychological handle, which is right around the 200 SMA and a rising trend line support that hasn’t been broken since late 2015. What’s more, stochastic has all but reached the oversold territory!
As you can see on the daily chart though, the .8400 level also marks the “neckline” of what looks like a head and shoulders situation. A break below said support level could lead to a move down to the .8000 area before coming up for air. Which way do you think the pair will go? Will it bounce from the trend line support? Or will it complete a head and shoulders pattern and finish with a downside breakout?
Breakout alert! NZD/USD looks like it’s breaking above a falling channel that’s been going on since late 2016. A quick squeeze of the chart tells us that the next major area of interest is at .7700. This means that there’s still a lot of room to jump in if you think that Kiwi bulls can sustain the comdoll’s uptrend. But if you’re more conservative with your entries and you don’t want to get faked out, then you could also wait for a couple more bullish candlesticks before placing your buy orders. In any case, make sure you use wide stop losses when trading longer time frames like these!
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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.