Hello Forex Traders!
The AUD and CAD were the big movers in yesterday’s trading, whereas others such as the GBPUSD only bounced up and down in a tight 30 pip range for most of the time. Especially the commodity currencies have been on the move this week.
The Monday article did warn and show that the USDCAD was at a bottom of daily trend channel. And of course our Forex trading room caught a ton of pips on the USDCAD as well, besides all of the 1,000+ pips and R:R (10+) on AUD trades earlier this week. Make sure to join us now by clicking on this link!
Be aware the FOMC announcement is later today (Wednesday) at 2pm EST time. The market could slow down to a grinding halt when approaching the release so be cautious of trading for the entire day. Also realize that the volatility after the announcement could substantially increase.
With that said let us move on our daily technical analysis view point and read the information and seek the opportunities which the charts are presenting us.
For the EURJPY price seems to be a crucial talking spot. The break of the massive daily uptrend channel (purple) gave me cause to change my outlook on the currency from bullish to bearish. But the currency pair is giving us new information.
The EURJPY retraced back to the broken trend line, as we would expect. It also respected that trend line by bouncing off of it. Then the daily chart has seen 5 candles go sideways without a successful continuation of the downside break. And right now the high is being challenged and the top of a potential down trend channel has been broken (light green).
If we add the pieces then the chances of the downside break in fact turning out to be a correction for more upside OR more range environment are increasing. It is still too early to tell, but after a long consolidation zone on the daily and weekly time frames, the EURJPY is destined to make a big move sooner or later so that is why I am keeping a close eye on it.
Don’t forget to leave a comment below the article today! I am still waiting for the first brave person that would dare to indicate a target for the AUDNZD in yesterday’s article. Everyone is shy but there is nothing to be shy about. It is just a game for fun and no money will be lost on the guesstimate
The Swissy is in a massive daily consolidation pattern of some sort, most likely a complex wedge pattern. Especially of late this currency pair has been moving up and down like no tomorrow with several spikes on both ends. Obviously a trending environment is hard to detect on this daily chart.
It is interesting to note, however, that price is approaching the bottom of the wedge and therefore the potential of major support. It is breaking through the first support line (light blue), but there is another trend line connecting the very first two bottoms (purple) as well. And obviously the horizontal support lines as well.
All in all, it will be interesting to see whether and how price will bounce and respond to these support lines. Obviously the USD has lost value against the Swissy for a substantial amount and length, but at one point or another the currency will reach a break or bounce spot and that is exactly the position the USDCHF is reaching. When looking at the weekly chart, we can see that price is heading back towards the lows of the last 2 years.
Besides the above mentioned currency pairs, nothing much has changed compared to the outlook of Monday. Again, today’s FOMC announcement could shed some light whether we will see USD weakness continue or whether the USD can rebound against some of the currencies such as the EUR, GBP and CHF.
Make sure to list to Nathan’s video by the way on this trade is on EURGBP.
Thanks again for your reading and sharing!!
I wish you very Good Trading!!
Latest posts by Chris Svorcik (see all)
- The Number One Handbook on Trend Lines in Forex Part 4 - October 19, 2014
- Drawing Trend Lines on 2 Forex Pairs: Setups You Don’t Want to Miss - October 16, 2014
- Warning: Drama and Fireworks Ahead with EURJPY and USDCAD Breakout - October 15, 2014
Winner’s Edge Trading, as seen on: