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Welcome to a brand spankin’ new trading month!

We’re all about the European currencies today, as we mess around with EUR/JPY and GBP/CAD‘s charts.

Think you can get a good start for the month of May?

GBP/CAD: 4-hour

GBP/CAD 4-hour Forex Chart
GBP/CAD 4-hour Forex Chart

GBP/CAD looks ready to hit 1.7650, which has held as resistance at least twice since late March this year.

What makes the setup interesting today is that stochastic is now flashing an overbought signal.

Will pound bears defend the level for another day? Shorting at the first signs of bearish pressure at the range resistance would yield a good reward-to-risk ratio especially if you place your stops just above the range and target the range support just below 1.7300.

Feelin’ like buying the pound instead? That’s fine, you can also wait until the bulls break through the 1.7650 mark and then aim for a potential retest of the March highs near 1.8000.

EUR/JPY: 4-hour

EUR/JPY 4-hour Forex Chart
EUR/JPY 4-hour Forex Chart

Here’s one for my trend-trading brothas out there!

EUR/JPY is having trouble trading above 117.50, which isn’t surprising since it’s near a mid-channel resistance, 61.8% Fib retracement, AND is right under the 200 SMA on the 4-hour time frame.

Shorting at current levels would get you in on EUR/JPY’s downtrend at a good price especially if the bears drag the pair down to its 115.75 lows.

Just make sure to keep an eye on EUR/JPY’s average volatility when placing them entry and exit orders. You don’t want to get squeezed out of a good setup just because you’ve placed your orders too tightly, do you?

Forex Chart Settings:

Slow Stochastic: 14,3,3
100 SMA: Blue line
200 SMA: Red line