First up is yesterday’s setup for EUR/NZD. If y’all somehow forgot already, we got us a descending channel pattern on EUR/NZD’s 1-hour chart. Back then, price was close to the channel’s resistance area that was close to the area of interest at 1.5140. We were therefore lookin’ to go short and all that. And, as y’all can see, the pair moved down all the way to the channel’s support area at the 1.5000 major psychological level. Booyah! That’s a 140-pip move in one day! We’ve got bank, homie!
Anyhow, the pair is back at the channel’s support area, so y’all better start looking for opportunities to go long. And all the more so, given that stochastic is already indicating oversold conditions and all that. By the way, going long here is a counter-trend setup, so more conservative forex traders may wanna sit this one out for now. But for those of ya who are gangsta enough, if support at 1.5000 holds, then the bulls will likely be gunning for the channel’s resistance area at 1.5140.
However, there’s also a small chance that the pair may break to the downside instead. If that be the case, then bears will likely be shooting for the next area of interest at 1.4850.
Next, we’ve got us a fresh rectangle pattern for CHF/JPY’s 1-hour forex chart. We originally had an ascending channel on this pair, which y’all can still see on that there chart. And way back on December 21, I told y’all that bears appear well-entrenched at 115.20. Bears may therefore get tempted to stage a downside breakout. And, well, we did see a downside breakout all right. However, the pair ended up trading sideways after finding support at 113.80. In the process, we got us a fresh 140-pip trading range or rectangle pattern to play with.
Anyhow, the pair is presently testing that there rectangle’s support area. So if y’all plan to trade within the range, then y’all better start lookin’ for opportunities to go long. Lookin’ at our technical indicators, stochastic be lookin’ fine, since it’s already indicating oversold conditions. However, the moving averages are kinda whack, since they recently crossed-over into downtrend mode. There’s therefore a small chance for a downside breakout, so y’all may wanna prepare for such a scenario. And as always, just make sure to practice proper risk management, okay homie?
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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.