We’ll start with the updated chart for GBP/CAD. If y’all remember, we identified an ascending triangle on GBP/CAD’s 1-hour forex chart last Thursday, and it seems like the pair just shrugged off the bearish divergence between price and stochastic (which I intentionally left on the chart) because the pair skyrocketed for about 400 pips before being repelled at the 2.0970 handle.
The pair tried to break past the 2.0970 handle at least three times and failed on all attempts. Now, price is moving back down, which may give us an opportunity to get on. Our directional bias is still to the upside since the bullish momentum is rather strong and because the moving averages are still indicating a healthy uptrend. For pullback areas to watch, both the 38.2% and 50% Fibonacci retracement levels look promising because they respectively sit on the 2.0780 and 2.0720 handles, which are price areas of market interest even on the higher time frames.
Next on our list is the updated chart of last Tuesday’s setup for EUR/CAD. As I said back then, I was pretty confident that support at 1.4450 will form and hold near the ascending channel’s bottom. And boy, did it hold! Not only that, it acted as a launching pad for an unexpected upside breakout that pushed price way above the channel’s top by around 700 pips. Amazing! And congratulations if you managed to ride that one.
Currently, the pair is pulling back and seems to be testing the 38.2% Fibonacci retracement area, so we may have an opportunity to get back on soon (or add positions if you are still in the trade). The 50% retracement level also looks like a good area for price to pullback to. In fact, it would probably be even more conservative since the 100 SMA is expected to act as dynamic support when price does come down to that level. Stochastic is already pointing up and moving away from the oversold region, though, so perhaps forex traders bullish on the pair may be taking control already.
Lastly, I have the updated chart for last Monday’s setup on USD/CHF’s 1-hour forex chart. I’m pretty sure most of y’all have forgotten this setup already, so let me give you a little refresher. Last week, I identified an ascending channel for USD/CHF’s 1-hour forex chart, but I also mentioned that resistance at the 0.9790 handle seems very strong, which is why I had two scenarios in mind: a downside channel breakout or an upside channel continuation. Obviously, the 0.9790 handle held like a boss and a downside channel breakout came into play, so congratulations if you were able to ride the 500-pip move.
Now, price is pulling back after being rejected at the 0.9260 handle. So for today’s play, we have a pullback setup in mind. Using the Fibonacci tool, it looks like price is approaching the 38.2% retracement level. That level looks like a nice area for price to pullback to since the 0.9460 handle has seen significant market interest in the past. The 50% retracement level looks attractive too since the 0.9520 handle has seen market interest even on the higher time frames and the 100 would be acting as dynamic resistance to boot.
As usual, make sure to practice proper risk management should you find a trade based on this or any of the other 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