With the ECB and BOJ statements coming up, I’ve got my eye on these neat plays on euro and yen crosses. Check ’em while they’re fresh!
First up is this long-term correction setup on the daily chart of EUR/CAD. The pair has been trading above an ascending trend line and could be due for another test soon.
Euro bulls seem eager to charge, though, as price is already bouncing off the 38.2% Fibonacci retracement level while stochastic shows a pickup in buying momentum.
In that case, the pair could make it back up to the swing high around the 1.6150 minor psychological mark if the ECB statement turns out more hawkish than expected.
This one just recently broke past the neckline of a long-term double bottom pattern, signaling that an uptrend is underway. A major correction could take place before more bulls join in, with price closing in on the 38.2% Fib level.
A deeper pullback could last until the broken neckline near the 50% Fibonacci level or all the way down to the 61.8% level, especially since stochastic is still heading lower. Just stay on the lookout for any shift in BOJ policy bias when trading this one.
Last but not least is this extra strong channel on EUR/GBP. This one has been holding since last year and euro bulls have just defended the bottom once more!
This opens up a pullback opportunity to the mid-channel area of interest near the 38.2% to 50% Fib levels or all the way up to the channel top at the .8900 handle.
Stochastic is already indicating overbought conditions, though, so sellers may be ready to jump back in, probably if the ECB decision disappoints or the U.K. GDP surprises to the upside.
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