First up for today’s yen + chart pattern double special is that there ascending triangle for NZD/CAD. An ascending triangle is a bullish chart pattern that usually forms at the end of an uptrend, so it’s kinda weird that one is forming here. Anyhow, our main directional bias is still to the upside since the moving averages are in an uptrend while stochastic is signalling oversold conditions. And if an upside breakout does occur, then the pair may have enough momentum for a 180-pip move, based on the height of the chart pattern. Do note that there’s always a chance that the pair could break lower, though.
Next, bulls and bears are fighting it out on EUR/JPY’s 1-hour chart, but neither side is really winning since a symmetrical triangle pattern is beginning to emerge. Since bulls and bears have no clear advantage over each other, then that means that the pair could break out in either direction. And assuming that a breakout does occur sooner or later, then the resulting selloff or rally could potentially last for about 170 pips.
Finally, CHF/JPY has been grinding lower while bouncing up and down inside a descending channel. And as I always say, one of the more conservative ways to play a descending channel is to look for shorting opportunities near the channel’s resistance area. However, the pair is currently at the mid-channel area, so more conservative forex traders may wanna sit this one out. For the more aggressive traders, though, just now that the pair seems to have found enough buyers to keep supported while stochastic is already indicating oversold conditions, so there’s a chance that the pair could move back up.
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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.