We’re all about the European currencies today, yo! Check out EUR/USD and CHF/JPY’s charts and see if you can make pips off of them!
Remember that downtrend play that we spotted a couple of days back? Well, that ship has sailed!
If you still want in on the action, then y’all gotta pay attention because CHF/JPY is now back at the channel resistance area. What’s more, it’s also testing the 200 SMA on the 1-hour chart!
Before you sell the franc like there’s no tomorrow, though, you should also note that the recent bullish run looks like it’s got legs. That means it’s probably safer to wait for a bit of consolidation or bearish momentum before you bet on trend continuation.
Shorting at the earliest signs of bearishness would give you a good reward-to-risk ratio especially if you aim for the previous lows below 107.00.
If you’d rather trade an upside breakout, then you might want to wait for strong candlesticks above the 200 SMA before you pull the trigger on your buy orders.
Here’s one for the countertrend traders out there! EUR/USD looks like it’s ready to bounce after sporting a doji on the daily time frame.
What makes the setup more interesting is that the doji popped up just as the pair touched the descending channel support that has been confining the pair all year.
The cherry on top of the sweet setup is that stochastic has crossed and is about ready to pop up from the oversold region.
Planning on buying the euro against the Greenback? Just remember that countertrend trading isn’t for everyone.
Unless you’ve done it before, or you’re confident enough with your risk management skills, it’s alright if you skip buying the euro and wait for an opportunity to sell instead.