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Welcome to mid-week trading, forex brothas!

Let’s get you over the hump with a break-and-retest situation on EUR/GBP and a simple trend play on USD/JPY.

Let me know what you think!

EUR/GBP: 1-hour

EUR/GBP 1-hour Forex Chart
EUR/GBP 1-hour Forex Chart

Earlier this week, we looked at EUR/GBP possibly bouncing from a short-term range support.

The bulls did have control for a while, but the bears attacked around the mid-range levels and didn’t let go until EUR/GBP dropped to the .8590 area.

EUR/GBP is back at .8640, but now the broken range support lines up with a 38.2% Fib retracement of the euro’s last downswing. Not only that, but the 100 SMA has now crossed below the 200 SMA!

Are we seeing a legit breakout? Sellers can short at current levels, place their stops just above the SMAs, and then target this week’s lows for a decent risk ratio.

USD/JPY: 4-hour

USD/JPY 4-hour Forex Chart
USD/JPY 4-hour Forex Chart

Feel like trading the majors instead? Here’s one for ya!

USD/JPY is chillin’ at the 108.00 major psychological handle that also happens to line up with a 50% Fib retracement and a trend line support that hasn’t been broken since the start of the year.

Buying at current levels or at the first signs of bullish momentum is a good idea if you’re betting on USD/JPY jumping back to its March highs.

If you’d rather short the dollar against the yen, however, then you’ll want to do it if or when USD/JPY trades firmly below the trend line support. An SMA crossover wouldn’t hurt either.

Whichever direction you end up trading, make sure to practice your best risk management strategies and to stick to your trading plan!