If you’re getting a sense of déjà vu while looking at that chart, that’s probably because this is an updated chart for last Friday’s symmetrical-ish triangle pattern on NZD/JPY’s 1-hour forex time frame. Anyhow, congratulations on your 120 pips if you were able to ride the breakout. If you missed it, then fret not, since I found another setup. For today’s play, we’re waiting for a potential pullback. As y’all can see on that there chart, price seems to be having trouble getting past the price area of interest around the 81.90 handle. If that price area holds as resistance, then price would likely pull back. As to where it’s gonna pull back to, we have our handy Fibonacci tool for that. Personally, I think the 50% retracement level seems the most conservative since it sits right smack on the 81.00 major psychological level, but the 61.8% level looks good too since it is close to the breakout point. In any case, stochastic is already indicating overbought conditions, so forex traders who are bearish on the pair may be jumping in already.
GBP/JPY recently tried to smash through support at the 184.40 handle but kept getting repulsed, forming a double bottom reversal pattern in the process. The forex chart pattern’s neckline is at the 185.70 handle, so an up move could potentially last for around 130 pips. Unfortunately, bullish momentum was very weak when price breached the neckline, which leads me to believe that there’s a chance that price will trade sideways and form a rectangle instead. And it certainly doesn’t help that the moving averages are in downtrend mode, with the 200 SMA acting as dynamic resistance. Also, stochastic is already pointing downward and moving away from overbought territory.
No fancy forex charts pattern for this one. This here is just a plain vanilla break-and-retest setup, with a Fibonacci setup for extra flavor. Anyhow, price finally parted ways with the 130.70 handle after breaking past it, but later got rejected when it found support around the 129.80 level. Presently, price has already pulled back to the support-turned-resistance area at 130.70 and said price area seems to be holding. And if we apply our Fibonacci tool, we can see that the aforementioned price area lines up rather well with the 38.2% retracement level. And looking at our technical indicators, we can see that stochastic is already at the overbought area. Also, the moving averages are still in downtrend mode, with no signs of a potential cross-over. As usual, just make sure to practice proper risk management should you find a trade based on this or any of the other charts, okay?
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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