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EUR/USD: 1-Hour

EUR/USD 1-hour Forex Chart
EUR/USD 1-hour Forex Chart

This is the updated forex chart for yesterday’s Fibonacci retracement setup for EUR/USD.

I was asking yesterday if there was going to be a pullback, and today, that question was answered. EUR/USD did have a pullback and now seems to have found support at the 61.8% Fibonacci retracement level.

But is this just a pullback or the start of a new downtrend? Personally, my directional bias is still to the upside because the 100 SMA and 200 SMA are now in uptrend mode, with the 100 SMA acting as dynamic support. Stochastic is also currently in oversold territory, indicating that forex traders bearish on the pair may be potentially exhausted. Price also appears to be respecting an uptrend trend line.

USD/CAD: 1-Hour

USD/CAD 1-hour Forex Chart
USD/CAD 1-hour Forex Chart

Price is approaching a price area of very significant market interest around the 1.2290 handle, and I think that USD/CAD will react by testing that area briefly and then moving back down again.

These are my technical arguments for a down move: (1) as already stated, the current price level has seen significant interest in the past, (2) the moving averages are are in downtrend mode, (3) both the 100 SMA and 200 SMA are acting as dynamic resistance, (4) price broke through the 1.2290 handle with significant and convincing momentum, and (5) stochastic is indicating potentially overbought conditions.

The technical arguments for a down move may be many, but the market will do whatever it wants to do, so make sure to practice proper risk management should you find a trade based on this chart study.

USD/CHF: 1-Hour

USD/CHF 1-hour Forex Chart
USD/CHF 1-hour Forex Chart

While looking similar to the 1-hour forex chart for USD/CAD above, I’m less inclined to have a directional bias on USD/CHF since the downside break through the 0.9450 minor psychological had less momentum and because the moving averages are too far away to act as dynamic resistance. All other arguments for a down move still apply, though. But given current price action, there’s a possibility that forex traders bullish on the pair are gathering strength for an upside move, so again, make sure to practice proper risk management should you find a trade based on this chart.

Forex Chart Settings:

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

To get the complete picture and avoid getting blindsided by economic data, you also have to do your fundamental analysis.

Lucky for us, Pip Diddy fills us in on what we need to know about fundamentals with his Daily Forex Fundamentals.