The pair got pushed down hard after finding resistance at the 195.00 major psychological level. But then the pair also got violently rejected when it reached a price area of significant market interest around the 193.20 handle. Now, the pair seems to be holding onto another price area of recent market interest around the 193.90 handle. And if we place horizontal lines on those two price levels, we can see a potential trading range since price has ranged between those two levels before. The moving averages are still in uptrend mode, though, and stochastic is currently indicating potentially oversold conditions, so there is a good chance that price will begin moving back up again. But there’s also a chance that forex traders bearish on the pair are gearing up for further downside moves since the bearish momentum was rather strong.
After breaking past resistance around the 2.0380 handle, price began slowly grinding higher but kept being repelled when it tried to break past the 2.0580 handle. Today, forex traders bearish on the pair staged a counter-attack, pushing the pair back into the previous resistance area around the 2.0380 handle. But when price reached that price zone, it immediately got rejected, which indicates significant buyer interest in the area. And if we apply the Fibonacci tool, we can also see that the 2.0380 handle lines up quite nicely with the 50% Fibonacci retracement, which gives us another technical reason as to why this support area will hold. In addition, the moving averages are still in uptrend mode, and the 200 SMA is acting as dynamic support in line with the 50% retracemet level.
Check out this short-term ascending channel on GBP/CHF’s 1-hour time frame. The pair has been in a steady uptrend, as price made higher highs and higher lows in the past few days. It looks like a bounce off the channel’s resistance just took place and the pair might test the bottom once more, although price seems to have already found some difficulty in pushing past the forex chart pattern’s mid-channel area around the 1.5230 handle. Stochastic is still pointing down, but it’s about to reach the oversold region, so forex traders bearish on the pair may be exhausted soon. Lemme just remind y’all that the most conservative way to play this channel is still to look for support near the bottom of the channel, and not near the middle of the channel.
And as usual, make sure to practice proper risk management should you find a trade based on any of these charts.
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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.AUD/CAD 1-hour Forex Chart