Are European currencies in trouble?
Judging by the swing trade charts, the euro and pound could be headed for more losses against the franc and yen.
Check out GBP/JPY and EUR/CHF‘s setups, yo!
GBP/JPY: 4-hour
Guppy just broke below a low-key consolidation on the 4-hour chart, which is a BFD since GBP/JPY just bounced from a descending channel AND 100 SMA resistance on the 4-hour chart.
If you don’t feel like shorting the pound, however, then you can also wait for a break above the 100 SMA and channel and then aim for areas of interest like 133.40 or 135.25.
Just make sure that you know where to place your stops whichever bias you choose to trade today!
If you’d like clues on how far this pair can go in a day, then y’all better make some form of volatility analysis before you place them orders.
EUR/CHF: Daily
Here’s a longer-term downtrend for the trend fans out there!
EUR/CHF is finding resistance at the 1.0650 mark, which is right smack at the daily 100 SMA and a falling trend line that hasn’t been broken since April 2019.
Told ya it’s long term!
Before you short the euro like there’s no tomorrow, though, you gotta know that consolidations at the bottom of strong trends CAN lead to reversals.
That means you gotta be careful with your stops and make sure you’re flexible enough in case the euro kicks the franc’s butt!
For those who are looking to go long EUR/CHF, you might want to wait for a break above the trend line and 100 SMA and then target potential trips to the 200 SMA or the 1.0850 and 1.1050 handles.
Thursday, August 20, 2020