AUD/CAD has been grinding ever higher while bouncing around inside an ascending channel since early November. Price just moved past the mid-channel area for a potential test of the channel’s bottom, so we may get an opportunity to go long soon enough. There’s a small chance that price may not reach the bottom of the channel at all, however, since stochastic is already in oversold territory. In addition, the moving averages are clearly in uptrend move, and the 100 SMA could potentially act as dynamic support. In any case, just make sure to practice proper risk management should you find a trade based on this or any of the other charts, okay?
Looks like GBP/CAD has been respecting a rising trend line on its 1-hour time frame. The pair just recently tested the trendline, and support at 2.0710 held and price seems to be making its way back up. Since that there is a rising trend line, our directional bias is therefore to the upside. For trend confirmation, the 100 SMA is still above the 200 SMA, and the 100 SMA even acted as dynamic support for the most recent bounce. In addition, the stochastic oscillator is currently pointing up, so forex traders who are bullish on the pair may be in control already. The only worrying thing is that stochastic is about to reach the overbought area, which may entice some bears to start coming in.
One of the most conservative ways to play an ascending channel is to look for buying opportunities near the bottom of the channel. And today seems to be our lucky day since that’s where price is currently at. Looking at our technical indicators, the moving averages are still showing a healthy uptrend and stochastic is already indicating oversold conditions, so forex traders who are bearish on the pair may be exhausted already. The only thing to be worried about is that stochastic keeps getting pushed back down without ever reaching overbought territory, which could mean intense selling interest, so make sure to prepare for a possible downside channel breakout as well.
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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