It’s the start of a brand spankin’ new trading month, yo! Hit the ground running with these hot long-term shots on CAD/JPY and NZD/CHF!
First up is a nice and simple trend trade for CAD/JPY. As you can see, the pair is having trouble breaking above the 82.50 minor psychological handle.
And why wouldn’t it? Aside from the level lining up with the daily chart’s 100 SMA, it’s also near the descending channel resistance that hasn’t been broken since October last year!
Think the Loonie will extend its losses against the yen? Shorting at current levels would give you a good reward-to-risk ratio especially if CAD/JPY makes new 2019 lows after this 100 SMA retest.
If you’re not convinced that the Loonie will see further losses, though, then you could also wait for a break above the channel and the 100 SMA and place long trades that would target the 85.50 and 86.70 previous highs.
If trend-trading’s your thing, then here’s a cool range play for ya! NZD/CHF is knockin’ on the .6600 major psychological handle, which is right smack at a long-term range support that the pair broke back in early May.
What makes the setup more interesting today is that stochastic is flashing an overbought signal on the daily. Think it will lead to a support-turned-resistance scenario for NZD/CHF?
Shorting at the earliest signs of bearish momentum would still give you decent pips especially if you aim for the previous lows near .6430 and place your stops just above .6600.
If you’re one of them Kiwi bulls, however, then you could also wait for a convincing trip back up to the range and look out for a possible return trip to the .6900 previous range resistance.
Good luck and good trading this one!