Strong trends can lead to hot retracements! Check out what I spotted on AUD/USD and EUR/CHF’s 4-hour forex charts.
AUD/USD is chillin’ like a villain just above the .7250 handle, which is right around last week’s support level for the pair.
Which way will the Aussie go? Will it extend its downtrend and make new lows against the Greenback? Or will the bulls push it back up to the .7325 previous support and 50% Fib retracement level before the bears step in again?
Watch this one closely, brothas!
Here’s another trend play for ya! EUR/CHF has just bounced from the 1.1250 handle and it looks like the bulls have enough momentum to extend its uptrend.
The 1.1435 level is an area to watch since it lines up with a previous support, falling trend line, AND the 61.8% Fibonacci retracement on the 4-hour time frame.
Selling at the earliest signs of bearish momentum is a good idea if you believe that the common currency is in for more pain against the franc.
If you’re one of them euro bulls, though, then you could also wait for a break above the area that we’ve identified before pulling the trigger on your long trade orders.
Good luck and good trading!