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Here’s the market outlook for the week:
EURUSD
Dominant bias: Bearish
The bullish expectation on EURUSD has not materialized, for price dropped by over 300 pips. Indeed, last week saw the weakest movement on EURUSD since February 2015. Price has closed below the resistance line at 1.0850 and it could even reach the support lines at 1.0800 and 1.0700. Unless EUR is fated to reach parity with USD, the worst case-scenario on this market should not take it below the great support line at 1.0500. This week, bulls may make some effort to halt or reverse the current bearish trend.
USDCHF
Dominant bias: Bullish
This currency trading instrument moved upward by over 300 pips last week, owing to the weakness in CHF and the strength in USD. Price was able to move above the resistance level at 0.9850 and stays there, threatening to go towards the resistance level at 0.9900. Even the resistance level at 0.9950 is not safe from bullish attacks, because the bulls still have lots of energy left in them. The only thing that can change the course of the battle is an exponential stamina in EURUSD.
GBPUSD
Dominant bias: Bearish
GBPUSD, which is positively correlated with EURUSD, also fell southward last week, going below the distribution territory at 1.5050. A movement of 380 pips in one week is not something to be ignored, since this has resulted in a strong Bearish Confirmation Pattern in the chart. While the bearish movement is according to expectation, there may be some rally this week. The accumulation territories at 1.5000 and 1.4950 are being watched, and the distribution territories at 1.5100 and 1.5200 may be potential targets in case of a rally in this week.
USDJPY
Dominant bias: Bullish
As it was forecasted, this pair broke upwards, following the recent consolidating movement in the market. The price moved upwards from the demand level at 119.50, slashing through the supply level at 121.00, but failing to close above it. As long as Greenback holds onto its bullishness, the bias on this pair is bullish. The current price action and candlestick formations on 4-hour chart all point to further northward journey.
EURJPY
Dominant bias: Bearish
This is a bear market, which moved strongly towards the price zone around 131.00. This movement is contrary to the expectation, and therefore, long trades are currently not considered here. We should no longer expect any meaningful rally on this cross unless EUR gains a considerable amount of stamina. Then, we would want some confirmation of a trend reversal before long positions are sought.
This forecast is concluded with the quote below:
“I have found that when my primary goal is to trade well, I regularly experience moments of flow. I have also found that when my primary goal is to simply trade well, my results are better as a consequence.” – Dr. Ken Long
Source: Tallinex.com
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