For our first stop on our trip down memory lane, we’ve got Wednesday’s downside break-and-retest setup for CAD/CHF. And as y’all can see, that setup was very successful, allowing us to harvest around 140 or so pips. Anyhow, price has already reached the previous trough around the 0.7390 handle. And if support hold here and price pulls back up, then we may get another break-and-retest setup to play with. As for the likely pullback area, I’m eyeing either the 61.8% or 38.2% Fibonacci retracement levels since they line up with price areas of interest.
Our next stop, is the triangle setup on EUR/GBP that we identified back on Monday. As y’all can see on that there chart, the pair did break to the upside. Unfortunately, the bullish momentum was rather weak. Fortunately, an ascending channel has now formed for us to play with. Price is currently testing the channel’s resistance, however, so more conservative forex traders may wanna sit this one out for a while. But for the more aggressive forex traders out there, just know that the channel’s resistance area lines up with the 0.8460 handle, which is a very significant area of interest, even on the higher time frames. You can check it out for yourselves by zooming out to the daily or weekly chart. Also, stochastic is already signalling overbought trading conditions.
Finally, we have that there descending channel from yesterday’s intraday forex chart update. And it looks like the pair fell over 100 pips from last we saw it, so give yourself a pat if you were able to ride the down-move. Getting back on topic, today’s play is still that channel setup. If life gives you lemons, make lemonade, right? Like the setup for EUR/GBP earlier, however, the available setup on this chart is against the trend since we’re looking to buy in a downtrend, so more conservative forex traders may wanna sit this one out again. Stochastic is indicating oversold conditions, though. In any case, just make sure to practice proper risk management, 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.