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Here’s the market outlook for the week:
EURUSD
Dominant bias: Bullish
This pair started rising on August 15, and it gained more than 400 pips since then. However, there was a bearish retracement that took place last Thursday and Friday, which was not significant enough to override the recent bullish bias in the market (unless there is at least, 300 pip-drop from here). Price is supposed to recover and move higher this week, reaching the resistance lines at 1.1600, 1.1650 and 1.1700; which were all previously tested.
USDCHF
Dominant bias: Bearish
This is a bear market. Since the last consolidation phase ended, price has come down by over 250 pips, closing on a bearish note on Friday. Since there is a Bearish Confirmation Pattern in the market, it is rational to expect further bearish pressure, which may push price towards the support levels at 0.9650, 0.9600 and 0.9550. The selling pressure needs to be significant for the support level at 0.9550 to be breached to the downside.
GBPUSD
Dominant bias: Bearish
Cable is bullish in the short-term, but bearish in the long-term. Further northward movement will endangered the long-term bearish bias, while further southwards movement will strengthen it. Price closed below the distribution territory at 1.2900 on Friday, and may go slightly lower before any rally effort is made. The possibility of price moving lower is stronger than its possibility of moving higher.
USDJPY
Dominant bias: Neutral
The bias is now essentially neutral, and the situation in the market is currently dicey (as the market is choppy). Recently, price has swung between the supply level at 112.00 and the demand level at 109.50. As long as price is between these demand and supply levels, the neutrality in the market will persist. Once the demand level is breached to the downside (and price stays below it) or the supply level is breached to the upside (and price stays above it), the neutrality will end and a directional bias will start. Nevertheless, this requires a strong momentum to happen.
EURJPY
Dominant bias: Bullish
Since August 15, price has gained roughly 600 pips, before the bearish movement that was witnessed on August 30 and 31. From last week’s high, price went downwards by 200 pips, and it could still go downwards by another 100 pips or more or less. The bullish bias will remain intact as long as price does not go below the demand zone at 126.00. Bulls will generally continue to endeavor to push the price upwards.
GBPJPY
Dominant bias: Bullish
The cross is bullish in the very short-term (though the long-term bias is somewhat bearish). A strong movement towards the south will result in more emphasis on the recent bearishness in the market, while a strong movement to the upside will result in a Bullish Confirmation Pattern in the market. On the upside, the supply zones at 144.50, 145.00 and 145.50 could be reached, provided the market does not continue its current bearish correction.
This forecast is concluded with the quote below:
“Those who know me or who have traded with me know that I am always looking for a simple and straightforward approach to trading.” – Andy Jordan
Source: www.tallinex.com
Trading realities: http://www.advfnbooks.com/books/unlockpotential/index.html
