Back on March 17, the pair was close to that there descending channel’s resistance area, so we were lookin’ to go short. However, I also told y’all that there was a higher-than-average chance for an upside breakout. As such, I advised y’all that it would probably be prudent to prepare for an upside breakout scenario as well.
Well, check that out, dawg! As y’all can see, the pair did break to the topside. It even broke past the area of interest at 1.6330 that I told y’all to keep an eye on. And if you jumped in with a long, then you probably got about 300 pips right now. Aww, yea! But if you waited for the pair to clear 1.6330, then, well, you still got 60 or so pips. And that ain’t so bad.
Anyhow, the seems to have found fresh buyers at the area of interest at 1.6410. Also, stochastic is already indicating overbought conditions and all that. There’s therefore a good chance that the pair may start pulling back.
As to where the pair will pullback to, the first price area to scope out is 1.6330 obviously. However, there’s a chance that the pullback could be deeper, all the way to 1.6210. And it just so happens that 1,6210 sits just right above the 50% Fibonacci retracement level.
Lookin’ for something more fresh? If you are, then check out that fresh descending channel for EUR/GBP. As y’all can see, the pair has been trading lower while bouncing up and down inside a descending channel. And as I always say, 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. Unfortunately, the pair is currently milling about at the channel’s support area. More conservative forex traders may therefore wanna sit this one out for now until the pair climbs back up again.
But for the more gangsta traders out there, the pair is currently hesitating at the area of interest at 0.8610. Also, stochastic is moving back up again after having reached oversold territory. There’s therefore a higher-than-average chance that enough bulls will start coming in to push the pair higher. And if them bulls do start jumping in, them they will likely be gunning for the channel’s resistance area, which should be around 0.8860. Anyhow, just remember to always practice proper risk management, a’ight?
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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.