First up is a support-turned-resistance situation on EUR/USD’s 1-hour time frame. The pair is currently lollygagging at the 1.0700 area after hitting bottom at 1.0600 last week. What makes the retest of the broken channel support more interesting is that the 100 SMA looks like it’s also about to cross below the 200 SMA. What’s more, stochastic is chillin’ like a villain on the overbought territory. Think the euro is about to see more losses against the dollar? Shorting at current levels is a good idea if you’re one of them dollar bulls. Of course, you could also wait for a bearish momentum if you think that EUR/USD’s dip below the channel is just a fakeout.
Here’s another trend play for ya! NZD/JPY is playing around the 82.50 levels, which is right smack at a rising channel support AND the 100 SMA on the 1-hour time frame. Easy peasy! Buying at current levels could give you a good reward-to-risk ratio especially if you aim for the previous highs near the 83.25 or 83.75 levels. Just make sure you use wide stop losses, aight? Yen crosses like these tend to see more volatility than the majors, after all.
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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.