First up in today’s yen + channel double special is that there descending channel for USD/JPY. The pair just recently bounced off the mid-channel area after the 100 SMA also served as dynamic resistance. However, stochastic is already indicating overbought conditions, so there’s a chance that the pair could move higher. Opening a long position here is a counter-trend setup, though, so more conservative forex traders may wanna sit this one out.
Next, AUD/JPY appears to be trading sideways on first glance. However, if we connect the highest peaks and the lowest troughs, then we get a slightly ascending channel. Stochastic is presently pointing up and moving away from oversold territory, so the bulls may be in control already. Also, the moving averages just recently crossed-over into uptrend mode, which is another signal that the bulls may be in control.
Finally, we’ve got another descending channel for CHF/JPY. This channel setup is a little more complicated that the other two setups above, though. Normally, one of the more conservative ways to play a descending channel is to look for opportunities to go short near the channel’s resistance area. And it just so happens that price is milling about there. However, the pair seems to be having some trouble moving lower past the 103.80 handle. And as y’all can see on the chart above, the said handle has some rather significant market interest. There is therefore also a good chance that 103.80 will hold as support, which may pave the way for an upside channel breakout.
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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.