That there is an updated chart from yesterday’s intraday charts update. And back then, price was milling about at the ascending channel’s resistance area near the area of interest at 1.2860. As such, we were looking to go short. And as y’all can see, the pair moved about 150 pips lower since last we saw it. Congratulations are therefore in order if you were able to go short.
And since the channel is still intact, with the pair currently near the channel’s support area, why not play it again? If life gives you lemons, then you go and make some lemonade, right? Anyhow, looking at our technical indicators, we can see that stochastic is already signaling oversold conditions. The moving averages, meanwhile, are still in uptrend mode, with the 200 SMA acting as dynamic support to boot. Overall, things look favorable for a long. Just keep an eye on how price reacts to 1.2860 (if or when it gets there), since bearish interest seems rather strong there.
As usual, though, there’s always a chance of a downside channel breakout, so don’t forget to practice proper risk management should you find an opportunity to go long.
If y’all can still recall last Friday’s intraday chart update, we originally had a rising wedge pattern on CAD/CHF’s 1-hour chart. That chart pattern got invalidated, however. And taking the most recent price action into account, it seems like the pair was trading inside an ascending channel instead.
Anyhow, the pair is currently near the channel’s support area. However, bulls haven’t mustered enough momentum to continue moving higher, since selling interest at the 0.7600 major psychological level also seems strong. This gives us two major scenarios: (1) the bulls capitulate and the bears stage a downside channel breakout while gunning for the next area of interest at 0.7530, or (2) the bulls finally power through and continue respecting the channel.
Stochastic seems to support the first scenario, since it is already moving back down after having reached overbought territory. The moving averages, meanwhile, are supportive of the second scenario because they are still indicating a strong uptrend, with the 100 SMA acting as dynamic support to boot. Price could therefore go either way, so it would probably be prudent to prepare for both scenarios.
EUR/CHF recently surged very hard to the upside. However, the bullish momentum abruptly evaporated when the pair reached the 1.0850 minor psychological level, probably because the said level is a price area with very significant market interest, even on the higher time frames. But even though the bullish run lost momentum, bulls were not ready to give up, and so the pair began trading sideways. In the process, a bullish flag pattern has emerged.
A bullish flag is, well, a bullish pattern, so our primary directional bias is to the upside. And should an upside breakout past 1.0850 occur, then the resulting move may have enough steam for a 140-pip run. The only worrying thing here is that stochastic is already indicating overbought conditions, since that may attract enough sellers to push the pair lower instead.
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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.