Wassup, forex brothas! I’ve spotted a nice trend play on AUD/NZD and a potential break-and-retest situation on EUR/JPY. Check them while they’re hot!
Is EUR/JPY ready to switch trends? The pair just got rejected at the 133.00 major psychological handle, which lines up with a channel support that the pair had broken earlier this year. What’s more, it’s also near a 50% Fib retracement from March’s lows!
With the 100 SMA poised to cross below the 200 SMA and stochastic flashing an overbought signal, you can bet your pips that forex bears are already watching this one.
A short trade at the first signs of bearish momentum could give you a good reward-to-risk ratio especially if you aim for the previous lows and place your stops just above the 50% Fib.
If you’re one of them euro bulls, though, then you could also wait for EUR/JPY to make new April highs and go back to its rising channel before you set up your orders.
Don’t take your eyes off of this setup, fellas!
AUD/NZD found support at the 1.0550 psychological area and is now about 150 pips from the level. Question is, will the Aussie sustain its bulish momentum, or will the bears step in some time?
The 1.0800 area is a level to watch, as it’s near the 100 and 200 SMAs as well as some Fibs that are lining up with previous areas of interest.
Aussie bulls can go with the flow and trade an uptrend until AUD/NZD shows signs of exhaustion. After all, 1.0800 is still 100 pips or so away.
Meanwhile, the bears can wait for the earliest signs of bearish momentum and aim for a retest of the channel support. Be careful about placing your orders, though. Remember that countertrend trading isn’t for everyone!