In today’s intraday charts update, we’ll be taking a stroll down memory lane as we check up on our old setups on EUR/USD and EUR/CHF. And as usual, we’ll be lookin’ for fresh plays as well.
And back then, we were lookin’ mainly to go short since the pair was testing the channel’s resistance area at the 1.2000 major psychological level.
Well, 1.2000 did hold as resistance and the pair did eventually move back down. And if you were able to catch that downswing, then congratulations on bagging some delicious pips. Aww, yeah!
Anyhow, the channel is still intact, so why not play it again? And all the more so, given that the pair is testing the channel’s resistance at 1.1900 while stochastic is already signaling overbought conditions and all that.
Just note that the pair failed to test the channel’s support during the most recent downswing. And that implies that bulls are beginning to put up a fight. There’s therefore also a risk that the pair may stage an upside channel breakout.
If such a scenario plays out, then a move higher past 1.1940 would be an early sign that bulls are taking control. The pair still needs to clear 1.2000 in order to validate the breakout, though.
I told y’all back then to prepare for both an upside and downside scenario since the pair is just as likely to break to the topside as the downside.
And as y’all can see, the pair opted to break to the downside. The pair even easily smashed lower past the area of interest at 1.1930 that I told y’all to keep an eye on.
And if you were able to catch that breakout move, then congratulations. We got bank, dawg! Aww, yeah!
But if you missed that move, then fret not since the pair found support at 1.1870 and is currently pulling back. And since the pair is pulling back, today’s play is therefore a retracement setup.
And if we apply our handy Fibonacci tool, we can see that the pair is already hesitating at the 38.2% retracement level, which happens to line up with the area of interest at 1.1920.
And since stochastic is already signaling overbought conditions and all that, there’s a chance that 1.1920 may hold as resistance and send the pair lower.
However, there’s also a chance that the pullback could be deeper, with the 50% and 61.8% retracement levels in focus. After all, the area of interest at 1.1930 is sandwiched between those two retracement levels.
Anyhow, if resistance does form and if the pair does start moving lower, then them bears will likely be gunning for 1.1870 and then 1.1840 after that/
In any case, just make sure y’all remember to practice proper risk management as always, a’ight?