Sup, peeps? It’s a brand new trading week, and I’m starting this week’s intraday charts update with a fresh head-and-shoulders play for EUR/CAD and an updated chart for our ascending channel on GBP/NZD.
Up first is that there fresh head-and-shoulders pattern for EUR/CAD. As y’all can see, the pattern has already been validated, since the pair has already breached the neckline, so sound the reversal alert, yo!
Gangsta traders may be tempted to jump in already. But for the more conservative forex traders out there, just know that stochastic is already signaling oversold conditions and all that. Y’all may therefore wanna wait for a pullback to 1.4180 or a break-and-retest of 1.4090 before shorting.
However, if the pair rushes past 1.4180 on strong momentum, y’all may wanna think about bailing or even switching bias. After all, a move past 1.4180 could mean that them bulls are trying to invalidate the pattern. But if 1.4180 holds or the pair continues moving lower without a pullback, then them bears would likely be gunning for the next area of interest at 1.3950. Y’all may therefore wanna observe how the pair reacts if or when it does get there. And as usual, just make sure to practice proper risk management, a’ight?
The last time we checked up on that there ascending channel for GBP/NZD was back on April 3. Back then, the pair just pushed away from the area of interest at 1.7940. And since then, the pair found support at 1.7800, bounced back to 1.7940, got rejected again, and went back down to 1.7800.
Anyhow, the channel is still intact and the pair is currently testing the channel’s support area. Normally, I’d tell y’all to start lookin’ for opportunities to go long. However, them bears appear well-entrenched at 1.7940. It would therefore probably be more prudent to wait for an upside breakout past 1.7940 before going long.
Moreover, resistance at 1.7940 seems so strong that bears may even use it as a diving board for a downside channel breakout attempt. Y’all may therefore wanna prepare for such a scenario as well. And all the more so, given that stochastic has just left overbought territory. A downside channel breakout needs to clear 1.7660 on strong momentum to be confirmed, though. So if you do short on a breakout, make sure to keep a close eye until 1.7660 is cleared before you start chillaxing. Know what I’m sayin?
Forex Chart Settings:
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.