For the euro bears out there, check out that there ascending channel on EUR/GBP’s 1-hour chart. Price is currently milling about near the channel’s resistance area, so y’all better start looking for opportunities to go short. Just note that shorting this pair is a counter-trend setup, though, so more conservative forex traders may wanna sit this one out for now, especially since stochastic is bouncing higher after very briefly visiting the oversold area.
Are you more bullish on the euro? Then how about that there potential rectangle pattern for EUR/AUD? As y’all can see, the pair has been respecting the 1.4900 major psychological level as resistance. The pair has also been respecting the 1.4500 major psychological level as support, which gives us a rather wide 400-pip trading range to play with. Do note that the chart pattern hasn’t been validated yet, though. Price has to bounce from support at 1.4500 before we can confirm the rectangle pattern.
If you don’t have a clear trading bias on the euro, then you may like that there descending channel for EUR/NZD. A descending channel is a bearish chart pattern, so our main directional bias should be to the downside. However, the pair has been testing (and has been having difficulty breaching) the area of interest at 1.5460.
This gives us two scenarios: (1) the pair respects 1.5460 and bounces higher for a possible upside channel breakout, or (2) price breaks lower past 1.5460. Our technical indicators are currently divided since the moving averages are in down trend mode. Meanwhile, stochastic is pointing up and moving away from oversold territory, which indicates bullish momentum.
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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.