Remember that range that we spotted last week? Well, it looks like USD/JPY saw an upside break after all! What makes the setup interesting today is that the pair is back at the 114.75 range resistance that it broke late last week. Oh, and look at stochastic chillin’ like a villain on the oversold territory! Are we looking at a break-and-retest situation over here? Buying at current levels could get you a sweet deal if you think that the dollar is headed higher. If you’re one of them conservative traders though, then you could also wait for the pair to confirm a bounce and make new highs before you enter your long trades.
Here’s one for trend traders out there! EUR/USD is currently testing the 1.0700 major psychological handle, which is right smack at a falling trend line resistance AND the 100 SMA on the daily chart. And with stochastic already near the overbought region, you can bet your neighbor’s cat that forex traders are watching for a possible downside move. But before you short the euro like there’s no tomorrow, you should also know that a rising trend line has popped up to form a symmetrical triangle on the time frame. That means you gotta be extra careful, yo! Better yet, you might want to wait for a break in either direction before you put on any position. In any case, make sure you practice good risk management when you do take them trades!
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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.