It’s a fresh trading week, so let’s start with a couple of fresh short-term chart patterns for the euro in today’s intraday charts update. Specifically, I’ve got a triangle for EUR/USD and a descending channel for EUR/NZD.
Sup? Bulls and bears have been slugging it out recently, but neither side has a clear advantage. As a result, EUR/USD has been consolidating while tightening to a point, forming that there symmetrical-ish triangle pattern in the process.
A symmetrical-ish triangle pattern could potentially break out in either direction, so we don’t really have a directional bias on the pair. Y’all may even wanna prepare for both a downside and an upside breakout. And in case an upside breakout does happen, just keep in mind that the pair needs to clear 1.0710 before the breakout is confirmed. Otherwise, chances are good that the breakout may end up being a fakeout. Know what I’m sayin?
A downside breakout, meanwhile, needs to clear 1.0570. Although really conservative forex traders may wanna wait for the pair to smash 1.0530 on strong bearish momentum before chillaxing.
In my chart art from earlier, I had a Fibonacci setup for EUR/NZD on the daily chart. If that’s too long-term for your taste, then how about that there descending channel for EUR/NZD’s 1-hour chart?
As y’all can see the pair has been trading lower while trapped in that there descending channel. And presently, the pair just bounced off the channel’s support area. And the pair is now likely gunning for the channel’s resistance area, which would be around the 1.5260 handle. Y’all therefore better get ready to start lookin’ for opportunities to go short soon.
There’s a small chance that the pair may resume moving lower without ever reaching the channel’s resistance area, though. There’s even a slim chance for a possible downside channel breakout. After all, stochastic is just about to signal overbought conditions and all that, which may entice bears to start jumping in.
In any case, just make sure to practice proper risk management as always, 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.