AUD/JPY is on its way to the top of its long-term range, which can be clearly seen on the daily time frame. Stochastic is already indicating overbought conditions, which suggests that bears could push the pair back down sooner or later.
The resistance at the top of the range could hold since it lines up with the 94.00 major psychological level. Shorting at this level with a stop above the previous highs around 96.50 and a target at the bottom of the range around 88.50 could yield a high return on risk for a swing trade.
To maximize profits, one can add every 100 to 150 pips and trail the stop loss by the same amount.
GBP/USD has made a stellar rally in the past few trading days, but it appears that the climb is losing steam and the pair needs to make a pullback.
On the 1-hour chart, it can be seen that the 38.2% Fib level lines up with the former resistance around the 1.6600 major psychological level. A retracement to this potential support zone could result to a bounce back to the previous highs. Stochastic is already moving out of the oversold zone though, indicating that bulls are eager to let the rally resume.
Going long at 1.6600 with a stop below the 61.8% Fib and a target of the previous highs around 1.6800 could mean a 1:1 return on risk.
Thanks to the recent upward revision in the BOE’s growth and inflation forecasts, combined with the BOJ’s easing bias, GBP/JPY has been climbing up the charts and trading above a rising trend line on the 1-hour time frame.
However, the weaker than expected UK CPI released this week triggered a bit of a selloff for this pair. It is currently testing the rising trend line, which coincides with an area of interest. The 170.50 minor psychological level used to be a resistance area and now it might act as support.
Stochastic is almost in the oversold region and making its way out so a bounce might be in the works. If that’s the case, the pair might climb back up to the previous highs around the 172.00 mark or make new ones.
Going long at market with a stop below 170.00 and an initial target of 172.00 could make a 2:1 return on risk. Aiming for new highs could improve the reward potential while trailing the stop could help protect profits.
USD/CHF is currently testing a major support level, as can be seen on the longer-term time frames. This is in line with the .8900 major psychological level which has held for the past few months. Stochastic has reached the oversold region, indicating a potential bounce.
At the same time, a spinning top candlestick has formed right on the support level. A close above the spinning top’s high for the next daily candle could confirm the potential rally.
Setting a buy stop order above that high with a stop below the previous spike to the .8800 handle and a target near the previous highs around .9100 could yield a good return on risk for a longer-term trade.
NZD/USD is in a strong uptrend on its short-term time frame, boosted by rate hike expectations in this week’s RBNZ interest rate decision. Earlier today, New Zealand Prime Minister John Key remarked that rates need to return to normal levels sooner or later.
The pair has recently broken above a key resistance level at the .8400 major psychological handle. This could mean that more gains are in the cards, especially since a rising trend line can be drawn connecting the pair’s lows.
The pair could still retreat to the trend line before heading any higher. After all, stochastic is already in the overbought zone, suggesting that a quick dip might take place. Going long at the .8400 handle with a tight stop and a target of new highs around .8600 could yield a very promising return on risk.
USD/JPY might be in for a quick pullback to an area of interest before resuming its rally. The pair recently broke above the 102.50 minor psychological level, which has been holding as resistance in the past month.
The broken resistance zone is somewhere between the 50% and 38.2% Fibonacci retracement levels on the latest swing high and low on the 1-hour time frame. This might serve as a turnaround point from the pair’s recent retracement. Stochastic is pointing up but hasn’t reached the oversold region yet, which means the pair has room to dip a little lower before bouncing.
Going long at the 102.50 level with a stop below the 61.8% Fib level and a target of new highs could yield a good return on risk for a short-term trade. To protect profits, the stop can be adjusted to entry once price tests the previous highs around 103.70.
The short-term selloff on GBP/JPY may soon be over, as a classic reversal chart pattern has formed on GBP/JPY’s 1-hour time frame. A double bottom can be seen after the pair tested the support around 167.75 a couple of times then found resistance near 169.50.
The pair has yet to break above the neckline of the pattern before confirming that an uptrend is in the cards. Stochastic has reached the oversold zone and turned upward, indicating that bulls might be in control in the near term.
If that’s the case, GBP/JPY could climb by more than 150 pips upon breaking above the 169.50 neckline. A stronger rally could take it all the way up to the former highs near the 173.50 minor psychological level. On the other hand, pound weakness could trigger another test of the lows at the 167.75 area.
EUR/USD recently broke below a key support zone around the bottom of the rising channel on the 1-hour time frame and the 1.3800 major psychological level. This could be indicative of more losses for the pair, but a quick retracement might take place before the selloff carries on.
Stochastic on the 1-hour chart is already moving down from the overbought area, which means that sellers are in control. However, the pair could still pull up to the 1.3800 area, which is an area of interest around the broken channel.
Shorting at 1.3800 with a stop back inside the channel or above the 1.3850 level and a target at the next support area near 1.3650 could yield a 3:1 return on risk.
NZD/USD is still in an uptrend, with the rising trend line on the 1-hour time frame very much intact. Positive carry, thanks to the recent RBNZ interest rate hike, is keeping the pair afloat in the near term despite remarks from Finance Minister English regarding potential Kiwi depreciation.
Do take note though that stochastic is already down from the overbought zone, indicating that Kiwi bulls have run out of steam for now. The pair is consolidating above the rising trend line at the moment, waiting for a good catalyst for a bounce back to the previous highs.
Going long at market with a tight stop below the trend line and a target of previous highs around .8650 could yield a good return on risk for a short-term trade. Keep watch for any updates that could impact overall risk sentiment.
USD/CAD recently broke above a triangle pattern on its 4-hour time frame, suggesting that the uptrend is ready to resume. This breakout was sparked by comments from BOC Governor Poloz, suggesting that a rate cut might be in the cards.
After its rally past the 1.1200 mark though, USD/CAD retreated back to a resistance turned support zone. This is in line with the 50% Fibonacci retracement level, which is also close to the 1.1150 minor psychological support. The broken triangle resistance coincides with the 61.8% Fib level, which might also serve as support.
In addition, there’s a possible bullish divergence, with stochastic making lower lows and price making higher lows. Once the oscillator starts crossing higher and moving out of the oversold region, the pair might also be in for a climb.
Going long at 1.1150 with a stop below the 61.8% Fib and back inside the triangle could yield a 2:1 return on risk if one aims for the 1.1250 level.
GBP/USD has shown momentum in crrying on with its ongoing uptrend, as it bounced off support on the rising trend line connecting the lows on the 4-hour time frame. This suggests that bulls are back in action and are ready to push the pair back to its recent highs.
A continued rally could take GBP/USD up to the 1.6800 major psychological resistance. However, stochastic is already in the overbought zone, which means that pound bears are ready to push the pair lower. Another retest of the trend line might take place before the pair resumes the climb. Of course a downside break is also possible if today’s UK data comes in weak.
Going long at market if the retail sales report comes in strong could yield a good return on risk with a stop below the trend line or the 1.6400 handle and a target of 1.6800.
After a failed attempt to break above the previous double bottom chart formation, CAD/JPY is forming another reversal pattern on its 4-hour time frame. This time a triple bottom can be seen after the pair bounced off the 91.00 major psychological support.
With that, the neckline is still around the 94.00 mark and an upside break might mean a rally of at least 300 pips, which is the height of the chart pattern. This could take the pair back up to the 97.00 resistance level or the top of the uptrend around 99.00.
Stochastic is already in the overbought zone though, indicating that Loonie buyers are getting exhausted. This might lead to a quick pullback before buyers gather enough momentum for an upside break.
I am sorry Kate to bump into this discussion topic but I thought since I just opened a Live Ac with TW Corp, may be I shud take advise from you. So, I am a permanent resident of Canada, Alberta, how does this affect me since I live in Alberta and want to trade the OTC markets with the new IIROC regulations? For me TW CoRp is an offshore broker.
Please advise
On its daily time frame, USD/CHF has retraced to an area of interest around the .8900 major psychological level. This area served as support in the past and might hold as resistance moving forward. Stochastic is already indicating overbought conditions and might be ready to cross down soon.
In addition, a doji candlestick can be seen on the 50% Fibonacci retracement level. If the next daily candle closes below the doji’s low, it would confirm that the pair is ready to resume its drop.
A selloff could last until the previous lows near the .8700 major psychological support. Setting a stop above the 61.8% Fib level or at .8950 would yield a 4:1 return on risk for the trade.
USD/JPY has been on a strong rally lately after breaking above the consolidation pattern below the 102.50 minor psychological resistance. The pair seems close to testing another resistance level again, this time on top of the rising channel on its 4-hour time frame.
Stochastic is already in the overbought zone, indicating that bears are ready to push the pair back down. Resistance is located around the 103.50 minor psychological level.
Shorting at 103.50 with a stop above the 104.00 round number and a target at the mid-channel resistance could be a 2:1 return on risk. Aiming for the bottom of the channel around 101.75 could offer a better risk-reward ratio but it would be prudent to adjust the stop to entry once price reaches the middle of the channel.
Despite the sharp selloff that took place in today’s Asian trading session and the double top pattern that formed on the short-term time frames, NZD/USD’s uptrend is still intact. The pair is currently testing the rising trend line on its 4-hour time frame, right around the .8600 major psychological support.
Stochastic has already reached the oversold zone but hasn’t crossed upwards yet, indicating that Kiwi bears are still in control at the moment. An upward crossover could indicate that the selling is done and that bulls are ready to charge.
Going long around .8600 if reversal signals show up and targeting the .8700 major psychological resistance could yield a high return on risk with a tight stop below the trend line.
AUD/USD has formed a reversal pattern on its 1-hour time frame, indicating that the uptrend may be over and that a selloff is ready to take place. The pair is still testing the neckline around the .9225 level though before confirming the potential downtrend.
Stochastic is pointing down after moving from the overbought zone, indicating that Aussie bears are in control. This could lead to a break and a resulting 75-pip drop, which is the same height as the chart pattern. On the other hand, if the current level holds as support, another test of the previous tops might happen.
Shorting below .9225 with a 50-pip target and a tight 25-pip stop could work for a day trade. After all, Australia just released a weaker than expected retail sales reading and traders might start positioning for a good NFP reading.
USD/JPY is testing a key resistance level at the 104.00 major psychological mark prior to the release of the US non-farm payrolls figure today. Analysts are expecting to see a 200K increase in hiring, higher than the previous 175K figure and enough to bring the jobless rate from 6.7% to 6.6%.
A weaker than expected reading could spark a sudden dollar selloff as it would confirm the Fed’s assessment that the US labor market is still very weak. This could push USD/JPY back to the bottom of the channel around the 101.50 minor psychological support or to the middle of the channel around the 102.50 to 103.00 levels.
Stochastic reached the overbought level and crossed down, indicating that selling pressure is mounting. This suggests that the current highs might hold as resistance and that a selloff might be in the works, but it depends on the upcoming NFP to determine how long this drop might last.
Consolidation could take place prior to the actual NFP release although there might be some spikes here and there.
After trending lower towards the end of last year and the start of this year, CAD/JPY has formed a consolidation pattern and is indicating a possible reversal of the previous downtrend. A triple bottom can be seen on its 4-hour time frame and a break above the neckline could confirm the potential rally.
Canada recently printed stronger than expected jobs data while Japan is looking at further easing or a dovish BOJ rate statement for this week, as the sales tax hike has been implemented and might result to weaker economic performance.
The pattern’s neckline is located at the 94.00 major psychological mark and a strong upside break could carry on for as much as 300 pips, which is the size of the triple bottom pattern. Stochastic is almost in the oversold zone, indicating that buyers may be ready to jump in soon.
A long trade above the recent high or at the 95.00 major psychological level and a tight stop below the neckline could yield as much as a 2:1 return on risk if one aims for the 97.00 resistance.
