Up and at ’em, forex brothas! Today I’m serving up a possible bearish pennant on USD/CHF and a simple trend line support on EUR/JPY. Get ’em while they’re hot!
I spy with my Ray-B-covered eyes a possible pennant in the making! As you can see, USD/CHF is having trouble finding direction after falling from the consolidation near .9900. This has led to a consolidation (bearish pennant) after a steep drop.
Will the sellers pick up where they left off? A downside breakout could drag the pair down to at least the previous lows near .9700. If dollar bulls do decide to attack, though, then we could see the pair go back to its December highs near .9900.
Watch this one closely, fellas!
Here’s a nice and simple play for ya! EUR/JPY is currently testing the 135.15 level, which is right smack at a rising trend line retest AND the 200 SMA on the 1-hour time frame.
Stochastic has just left oversold territory, so it’s possible that a few of the bulls have already made their case. Still, a bounce from the trend line could boost the pair back to its January highs above 136.50.
If the pair breaks lower, however, then we could be looking at a move back to the 134.20 or even the 133.75 previous areas of interest.
Whichever bias you choose, make sure you use stop losses when trading volatile currency crosses like these!