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GBP/USD: 1-Hour

GBP/USD 1-hour Forex Chart
GBP/USD 1-hour Forex Chart

Reversal alert! After finding support around the 1.5690 handle, price has formed a rough-looking double bottom on the 1-hour forex chart for GBP/USD. The way to play this chart pattern is to wait for a price to break through the neckline at the 1.5750 minor psychological level.

Aside from the double bottom play, there are two other potential scenarios on this chart: (1) price will find resistance at neckline and go back down or (2) price will form a trading range between the the 1.5750 and 1.5670 handles. Well, whichever scenario you think is correct, make sure to practice proper risk management.

GBP/CHF: 1-Hour

GBP/CHF 1-hour Forex Chart
GBP/CHF 1-hour Forex Chart

Looks like GBP/CHF has been moving upwards in a neat ascending channel. The basic way to play an ascending channel is to look for support near the bottom of the channel. Luckily for us, price is currently milling about at the bottom of the channel. Also, the moving averages are indicating a healthy uptrend, with the 200 SMA acting as dynamic support. In addition, stochastic has reached oversold territory, indicating that sellers may potentially be exhausted soon.

As with all forex chart patterns, a breakout may also occur. In this case, there’s a chance that a downside channel breakout may happen, so prudent forex traders should also consider that possibility.

GBP/CAD: 1-Hour

GBP/CAD 1-hour Forex Chart
GBP/CAD 1-hour Forex Chart

Yep, we’ve got another channel forex chart pattern. This time, we’re looking at a descending channel on the 1-hour chart for GBP/CAD. For today’s play, we are looking for resistance to form at or near the top of the channel. We’re lucky again too since price is currently testing the channel’s top. I think there’s a very good chance that price will go back down since the top of the channel is at the 0.9480 handle, a price area of very significant market interest. Also, the 100 SMA and 200 SMA just crossed-over into downtrend mode. Finally, stochastic is already in overbought territory, so forex traders bullish on the pair may potentially be exhausted already.

Given that the bullish momentum is rather strong, there’s also a possibility that price will attempt a topside breakout, so make sure to consider that possibility too.

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.