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Here’s the market outlook for the week:
EURUSD
Dominant bias: Bearish
This pair has been able to continue its slow and steady journey downwards so far. There are occasional shallow rallies in the market – which often lead to renewed ‘sell’ signals. The Euro is very weak right now and the market has a high probability of remaining bearish next week (even in this month of August 2014). Yes, the probability that the market would remain bearish is far higher than the probability that it would turn seriously bullish. The market could become seriously bullish within the next several trading days, but the possibility of this happening is far less than the possibility of the market remaining bearish. A trend is not over until it is actually over.
USDCHF
Dominant bias: Bullish
What could happen next to the USD/CHF? Since the pair is in a negative correlation to the EUR/USD, it would go upwards as the latter goes downwards. The possibility of the continuation of the uptrend is very high, but there is an impediment to be overcome: the great resistance level at 0.9100. Just like the support level at 0.9000 – which gave the bulls extremely tough time before it was finally breached – the resistance level at 0.9100 is another barrier. However, the barrier must be broken to the upside for the bullish bias to continue, even if it is going to be a pyrrhic victory. The support level at 0.9000 itself is a great barrier to the bears’ interest, for the bear that tries it now could well be hurtling itself against a rock.
GBPUSD
Dominant bias: Bearish
The Cable is positively correlated with the EUR/USD, and thus should also continue trading downwards, unless there is an unexpected event which catapults the price skywards. There is a Bearish Confirmation Pattern in the market. The price could reach the accumulation territories at 1.6800 and 1.6750 sooner or later.
USDJPY
Dominant bias: Bearish
The USD may be strong somewhere else, but not with the JPY. In fact, most JPY pairs are bearish and the USD/JPY is no different. There is a ‘sell’ signal in the market, for the price could go on towards the demand level at 101.50. The supply level at 103.00 should check any serious bullish breakouts (for the bearish outlook could be rendered useless when it happens that the supply level is challenged).
EURJPY
Dominant bias: Bearish
As a result of the weakness in the Euro and the stamina in the Yen, this cross has become very weak. Long trades are no longer sensible here, for the price could reach the demand levels at 136.00 and 135.50 next week.
This forecast is concluded with the quote below:
“Trading is a joy to me and I do not get half as stressed as I used to do.” – Stu Whisson
Source: Tallinex.com
Learn from the Generals of the Markets: Market Generals
