It’s all about the trends today, forex fellas! I’m seeing potential pullback plays on the longer-term time frames of EUR/GBP and USD/CAD, and here are the levels you should watch.
EUR/GBP finally broke past that area of interest around the .8450 minor psychological mark, which happens to be the neckline of the short-term double bottom.
With that, the pair is now setting its sights on the descending channel resistance visible on the 4-hour time frame. The 100 SMA is about to make an upward crossover to signal a pickup in buying pressure, which might be enough to send price all the way up to the .8600 mark.
However, stochastic is already in the overbought region so buyers might need to take it easy from here. Once the oscillator starts turning lower, the pair could follow suit and make its way back to the mid-channel area of interest.
Now here’s a channel that’s been holding even before the Donald became President! USD/CAD has been moving inside an ascending channel formation on its daily time frame and is just bouncing off resistance.
This could mean that the pair is prime for another pullback to support, possibly until the mid-channel area of interest around the 1.3500 mark or all the way down to the channel support closer to 1.3350. Stochastic is heading south anyway, so sellers could be on top of their game.
The 100 SMA is still treading carefully above the longer-term 200 SMA to suggest that the uptrend is more likely to resume than to reverse. The 200 SMA even lines up with the channel bottom to add to its strength as a floor.