Trend riders better huddle up ‘coz I’m ending this week’s intraday charts update with a couple of descending channels on EUR/JPY and CHF/JPY.
As y’all can see on that there chart, EUR/JPY’s price action has began to tilt to the downside recently. And if we connect all the most recent peaks and troughs, we get that there descending channel.
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.
Well, guess where the pair is currently at, dawg. That’s right! Y’all therefore better start lookin’ for a chance to go short.
And all the more so, given that the channel’s resistance area happens to line up rather nicely with the area of interest at 124.40. Moreover, stochastic is already signaling overbought conditions and all that.
If or when the pair does move back down, then them bears will likely be gunning for support at 122.60 next, so keep an eye on that.
Price action on CHF/JPY is rather similar to price action on EUR/JPY. And as y’all can see, a fresh descending channel has also formed on CHF/JPY’s 1-hour chart.
Moreover, the pair just got rejected from the channel’s resistance area at 114.20 and is moving back down again. Also, stochastic is moving back down again as well after reaching overbought territory.
Do note, however, that there’s a chance that support may form at the area of interest at 113.20. The reward-to-risk ratio on this pair may therefore not be as good compared to the similar channel setup on EUR/JPY.
In any case, and however you plan to trade that chart, just make sure to practice proper risk management, a’ight? See y’all next week! Peace!