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These pairs are approaching long-term inflection points that might keep gains in check.

Is it time to short EUR/AUD and GBP/JPY?

Here are the levels I’m watching.

EUR/AUD: Daily

EUR/AUD Daily Forex Chart

EUR/AUD Daily Forex Chart

This pair has been rallying for almost an entire month, but its rally might be cut short soon.

Price is approaching a potential ceiling around the 1.5400 major psychological mark, which happens to be a former support zone.

Are sellers likely to defend the resistance?

Technical indicators are suggesting so, as the 100 SMA is below the 200 SMA to reflect bearish vibes.

At the same time, Stochastic is hovering around overbought conditions to indicate exhaustion among buyers. Once the oscillator turns south, EUR/AUD might follow suit and head back to nearby support levels.

If euro bulls are able to sustain the climb past the area of interest, on the other hand, this would translate to a double bottom neckline break. Watch out for a rally that’s the same height as the chart pattern if this happens!

GBP/JPY: 4-hour

GBP/JPY 4-hour Forex Chart

GBP/JPY 4-hour Forex Chart

Time to bust out the Fibs for this one!

Guppy has been rallying nearly nonstop over the past few days, pulling up from its steep drop early this week.

The pair has since retreated to the 61.8% Fibonacci level, which might be enough to keep gains in check. After all, this is right smack in line with the broken support zone around the 161.00 handle.

To top it off, this area of interest coincides with the dynamic inflection points at the moving averages, too. Plus, these indicators are attempting a bearish crossover to confirm that resistance is likely to hold.

Stochastic already made it to the overbought area to signal that buyers need a break and that sellers might take over from here. In that case, GBP/JPY could soon set its sights back on the swing low around 148.70.

Reversal candlesticks forming around current levels might be your cue to hop in a short position. Just don’t forget to check out the average GBP/JPY volatility when setting entries and exits!