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Forex Market starts to get interesting

Blog & Emails

The EUR/USD may be building a

Double Top. The GBP/USD scaled a new four day high, USD/CHF broke higher but follow through is small. These and other important moves in the market are setting the stage for some spectacular battles toward the end of this week. Today’s email may be thrown completely for a loop when the

FOMC makes it’s 14:15 announcement though.

EUR/USD: If a double top forms, will it hold?
GBP/USD: Just below critical level
USD/JPY: In the middle of a small uptrend
USD/CHF: Finds Resistance at 1.1465

EUR/USD
Price spiked to 1.3331 yesterday in early morning trade, and then again this morning, only 1 point shorter. If price falls below 1.3200 then I would consider a fully developed double top on the books. This would create short opportunities below the 1.3150 area. I won’t be looking for longs until a break or 1.3331 happens with some confirmation. On the hourly charts there is

Divergence building with RSI, showing a little weakness in the pair.
forex daily charts

GBP/USD
I am treating 1.4433 as the critical 50% Fibonacci

Retracement level on the 1.5376/1.3504 move. Current price action has stayed under there, finding resistance from the line noted in yesterday’s email. This morning there was a test to 1.4377, which was promptly killed, then retraced in the last 3 hours to 1.4340. This area should be the breakout or failure area for the pair.
forex daily charts

USD/JPY
I expect a test of the top resistance line in the next few hours. The only impediment to the move will be the high from yesterday at 90.09. This area is currently causing problems for the pair, and a fall to hourly highs around 89.48 may help unwind some selling from higher levels. I will be looking for breaks of either line to enter further long or short psitions.
forex daily charts

USD/CHF
The pair has found a small perch above the top line drawn on yesterday’s charts. The limiting factor in the pair is the 38.2% retracement of 1.1714/1.1314 at 1.1466. It’s quite possible that the retracment is complete further weakness in the pair may resume. My short would be looking for intial targets around the 1.1314 lows. A long trade may only find resistance a short way up at 1.1466, the 50% retracment level of the previously mentioned move.
forex daily charts