Back on March 3, we was tryin’ to add to our long bets on EUR/NZD. If y’all can still recall, we already had between 200 and 280 pips back then, because the triangle, which we identified back on February 24 (and that you can still see on the chart), finally broke to the topside. Anyhow, we was lookin’ to add to our long on March 3, as I said earlier. And we tried to that with a Fibonacci setup when the pair appeared to be hesitating at 1.5050. Unfortunately, that plan didn’t pan out since the pair opted to continue climbing higher without pulling back. But on a positive note, we now have between 500 and 580 pips in the bag from our triangle breakout setup. Not bad for a two-week ride. Aww, yea!
For today’s play, we can see that the pair has began to trade sideways after hitting the area of interest at 1.5350. In the process, a bullish flag appears to have formed. And looking at our technical indicators, we can see that them moving averages are still in uptrend mode. Stochastic, meanwhile, is pointing back up again without ever reaching oversold territory. This implies strong bullish interest, at least for now. Our main directional bias is therefore still to the upside. And if the bullish flag is validated with an upside breakout, then the pair may have enough steam for a 200-pip move.
However, it should be noted that 1.5350 is a very major area of interest, even on the higher time frames. Just switch to a daily or weekly chart, and you’ll see. There’s therefore a chance that the pair may pull back for a bit. And if a pullback does occur, the 50% Fibonacci retracement level looks like the key pullback level to watch. After all, it lines up with 1.5220. another price area of interest.
Back on Tuesday, I noted that EUR/JPY was testing that there descending channel’s resistance area. However, I told y’all to wait for a clear break past 120.30 before shorting because there’s a chance that them bulls may attempt an upside channel breakout. Well, that was great advice because the pair did stage a successful upside channel breakout. And it’s a confirmed breakout to boot, since the pair easily cleared the key level at 121.70 that I told y’all to watch. And if you were able to jump in at the breakout point, then congratulation on your 220 pips. You’ve hot skillz, dawg! But if you were more conservative and waited for a break past 121.70, then you still have 110 pips. Aww, yea!
But if you missed out, well, tough luck. Just kidding! Today’s play is actually for adding to our longs or opening fresh longs if you missed the ride. And we’re gonna try and do that with a Fibonacci setup. As y’all can see, the pair appears to be pulling back down after encountering sellers at 122.80, which is a price level that has served as resistance in the recent past. Moreover, stochastic is already pointing down after reaching overbought territory. All retracement levels look like good pullback areas to watch. However, the 38.2% retracement level looks extra attractive, since it lines up with the area of interest at 121.70. Again, though, all Fibonacci retracement levels are levels to keep an eye on. Oh, and as usual, make sure to practice proper risk management, a’ight? Peace! I’m out!
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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.