We’re kickin’ off the forex trading week with hot short and swing trade setups on GBP/USD and AUD/USD. Check it!
A couple of days ago we identified a possible area of interest on Cable’s daily time frame. If position trading ain’t your thang, though, then you should check out this shorter-term time frame!
GBP/USD is about to hit the 1.2750 minor psychological handle, which has not only been serving as area of interest since early June, but is also currently right at a falling channel resistance on the 1-hour time frame. What’s more, stochastic is chillin’ at overbought territory!
Think the bears will pounce at the setup? Or will bulls remain in control of the pair? Shorting at the 1.2750 area could get you decent pips especially if you aim for the 1.2500 previous support.
But if you’re one of them pound bulls, then you could also wait for a break above said resistance area and see if the pair shoots up all the way to its 1.2950 June highs.
Remember that Fib and SMA support that we were checkin’ out a couple of days back? Well, it looks like the support level has played out pretty well!
But the bears have come out to play, enough to form what looks like a head and shoulders pattern on the 4-hour time frame while stochastic is almost in the overbought region.
If the pair drops back down (or even break below) the .7550 head and shoulders “neckline”, then we could be looking at a 100-pip move to just below the 200 SMA support.
But if the bulls remain in control, then look for a retest of June’s highs near .7625 if not the .7675 area of interest from way back in March.