I’ve got my one good eye on the short-term setups on EUR/JPY, GBP/JPY, and EUR/GBP to see if nearby inflection points will keep holding. Take a look!
The lack of BOJ dovishness kept a lid on EUR/JPY gains as price bounced off the 130.50 minor psychological level to start forming a potential descending triangle.
The pair seems to be setting its sights on the support at the 128.50 minor psychological mark, which previously held as resistance. This also coincides with the bottom WATR and PWL, so there may be plenty of buy orders waiting at that area.
Stochastic is also pulling up from the oversold region to signal that euro bulls are ready to get back in the game soon, possibly spurring another test of the falling trend line connecting the recent highs.
- WO: 129.63
- Top WATR: 130.72
- Bottom WATR: 128.54
- PWH: 130.51
- PWL: 128.57
Guppy already broke below the neckline of the double top pattern I was watching, confirming that sellers are ready to push the pair much lower. The chart pattern is around 250 pips in height so the selloff could be of the same size.
Stochastic is climbing out of the oversold area, though, so a retest of the broken support around 145.50 could happen before sellers gain traction. There’s also potential support at the bottom WATR, which is close to the 143.00 major psychological handle.
- WO: 144.42
- Top WATR: 145.88
- Bottom WATR: 142.96
- PWH: 147.61
- PWL: 144.07
EUR/GBPEUR/GBP has formed higher lows and higher highs, creating an ascending channel on its 4-hour chart. Price is currently testing the top of the channel near the PWH and could be due for a move back to support.
Euro bears could regain the upper hand as stochastic is dipping into overbought territory, potentially taking price down to the bottom of the channel around .8830 or at least halfway there. But if pound bears refuse to back down, EUR/GBP could push past the channel resistance near the .9000 handle and go for a test of the top WATR.
- WO: .8977
- Top WATR: .9048
- Bottom WATR: .8905
- PWH: .8995
- PWL: .8744
This content is strictly for informational purposes only and does not constitute as investment advice. Trading any financial market involves risk. Please read our Risk Disclosure to make sure you understand the risks involved.