Who’s in the mood for some long-term retracements on USD/JPY and EUR/GBP? I hope you are, because these forex setups are too good to miss!
USD/JPY has gained bullish legs since dropping to the 105.00 levels in March, and is now trading just below the 109.00 psychological handle.
What makes the level more interesting is that it lines up with a 50% Fibonacci retracement and 100 SMA retest. Not only that, but the area has also supported USD/JPY for most of 2017! The cherry on top of the sweet setup is a low key bearish divergence forming on the chart.
Think this will spell more losses for the dollar? Shorting at the earliest signs of bearish momentum is a good idea especially if you think that the Greenback will drop back down to 105.00. Just make sure you use wide stops on trading longer-term time frames like these!
Dollar-trading not your thing? Here’s one for ya! EUR/GBP is about 150 pips away from its April lows when it dropped to the .8600 area. Thing is, it looks like the bulls might be losing momentum.
If the dojis from the previous days are anything to go by, it looks like the bears might have a shot at a retest of the 2018 lows. After all, stochastic is already flirting with the overbought territory.You could short the pair as soon as it makes new weekly lows if you’re one of them euro bears. But if you believe that the common currency would actually pop back up to its .8900 – .8950 highs, then you could also wait for a break above this month’s highs before you put on any orders.
Whichever bias you choose to trade, make sure you practice good risk management when you trade them!