Looks like the double bottom pattern we identified on AUD/CHF’s 1-hour forex chart yesterday got validated, with price moving up for around 130 pips from the broken neckline at the 0.6830 handle, so congratulations if you were able to ride that. If you missed that setup, don’t worry because we may have another opportunity to get on soon.
As y’all can see, the 200 SMA successfully acted as dynamic resistance, probably because it lined up nicely with the 0.6950 minor psychological level. Currently, price seems to be consolidating at the 38.2% Fibonacci retracement level, a price area of recent market interest that happens to be rather close to the broken neckline at the 0.6830 handle, which makes this a good area for buyers to come in. Stochastic is lookin’ good since it’s already in oversold territory and pointing up, indicating that forex traders bullish on the pair may be taking over already.
The potential double bottom on GBP/CHF’s 1-hour forex chart just didn’t pan out since the neckline at 1.4900 appears to be well-defended by the sellers. Instead, an ascending triangle has formed since the bullish offensive is just relentless. Our primary directional bias is still to the upside. And while the moving averages are still in downtrend mode, they are already beginning to come closer together for a potential cross-over, hinting that the trend may be changing. Stochastic is also beginning to point up after spending some time in the oversold region, so forex traders who are bearish on the pair my be exhausted already. It’s still a triangle, though, so there’s also a chance that a downside breakout will occur.
And now for something different. EUR/GBP surged higher with sufficient and convincing momentum until it got repelled at the 0.7350 minor psychological level. Neither sellers or buyers will give way that price began consolidating into what appears to be a bullish pennant.
As a bullish forex chart pattern, our main directional bias is obviously to the upside. The moving averages are still indicating a healthy uptrend, with the 100 SMA acting as dynamic support. Stochastic is a bit worrying, though, since it just moved away from the overbought area and is currently pointing down, so forex traders who are bearish on the pair may potentially be in control. In any case, the volatility of the pennant and its staff or post is around 350 pips, so price could potentially move for that amount should a breakout occur.
As usual, make sure to practice proper risk management should you find a trade based on this or any of the other charts.
Forex Chart Settings:
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