Back on March 7, if y’all can still recall, we tried to add to our profits on EUR/CAD via a Fibonacci retracement setup. You see, the pair encountered sellers at 1.4220 back then, so we was expecting the pair to pull back down to 1.4150 before climbing higher. Unfortunately, the lowest the pair got before shooting higher was 1.4160, which is ten whole pips away. That setup was therefore a dud, so sorry, y’all. Can’t win ’em all you know. Just keeping it real. But on a happier note, those of ya who found a trade based on our original symmetrical triangle (which y’all can still see) are now 430 to 500 pips richer. Aww, yea! And if you were gangsta enough to add to your bets when the pair broke higher past 1.4220, then just gotta say that you’ve got game, dawg.
Anyhow, the pair appears to have found fresh sellers at 1.4420. However, them bulls ain’t ready to give up just yet. As such, a fresh symmetrical triangle has formed. We’re still bullish on the pair since them moving averages are still in uptrend mode. However, a symmetrical triangle means that there’s also a chance that the pair may break to the downside. And all the more so, given that stochastic is already indicating overbought conditions and all that. Y’all therefore better be flexible enough and prepare for both an upside and a downside breakout. Also, just make sure to observe how the pair reacts to 1.4420 should the pair break higher. For a downside breakout, meanwhile, y’all may wanna keep an eye on both 1.4220 and 1.4150.
Y’all probably forgot already, but we originally had a descending channel for EUR/USD back on March 1. And way back then, I told y’all that there appeared to be a lot of bullish interest at 1.0530. As such there was a chance that them bulls will attempt to push the pair higher while gunning for a number of key price levels, with 1.0660 being one of ’em.
Well, that obviously happened and the pair has been trading higher ever since. And in the process, a fresh ascending channel has formed. And as I always say, one of the more conservative ways to play an ascending channel is to look for opportunities to go long. Unfortunately, the pair is currently at the channel’s resistance area, so more conservative forex traders may wanna sit this one out until the pair pulls back to the channel’s support area around 1.0710. But if you’re the more gangsta type, don’t be too quick to go short just yet, since stochastic is just about to enter oversold territory, which may draw in fresh bulls to push the pair higher, or even attempt 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.