Let’s end this week’s intraday charts update with a couple of charts patterns, namely a double bottom for AUD/USD and a triangle for NZD/USD. Check ’em out, peeps!
Bulls appear to have entrenched themselves at the 0.7500 major psychological level, since recent attempts by them bears to smash past 0.7500 have all failed.
And based on how price action on the two most recent failed attempts went down, we can see that a potential double bottom appears to be emerging.
I say “potential” because the pair needs to smash past the neckline at 0.7600 before the forex chart pattern is validated. And if bulls do manage to push the pair past 0.7600, then them bulls will likely be gunning for 0.7700 next.
However, do note that there’s a chance that bears may get the upper hand and 0.7500 may even potentially fail as support. After all, stochastic is indicating overbought conditions already. Meanwhile, them moving averages look like they’re about to cross-over into downtrend mode.
As y’all can see, a rather large symmetrical triangle has apparently formed on NZD/USD’s 1-hour chart.
A symmetrical triangle could break either to the upside or the downside, so we don’t really have a trading bias on the pair. Although y’all may wanna keep a close eye on how the pair reacts to the area of interest at 0.7110, assuming an upside breakout occurs.
You see, if bullish momentum loses steam at or just before 0.7110, then chances are good that the breakout may go nowhere or even get faded. Know what I’m sayin? For a downside breakout, meanwhile, just make sure to keep a close eye on 0.6890.
Again, the pair could break in either direction. But looking at our technical indicators, we can see that stochastic is already signaling overbought conditions and all that. As for them moving averages, they’re still in uptrend mode, but they’re coming closer together for a potential cross-over into downtrend mode. There’s therefore a chance that the pair may move back down, so real gangsta traders who want to trade within the triangle better keep a close eye on the pair.
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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.