Weekly Trading Forecasts on Major Pairs (March 17 - 21, 2014)

Here’s the market outlook for the week:

EURUSD

Dominant bias: Bullish

This pair is a bull market irrespective of the recent pullback on it. The pullback is just a good opportunity to go long when the price is on sale and in the context of an uptrend. Our target remains at the resistance line of 1.4000. Only a situation in which the price is below the support line at 1.3800 could render the bullish outlook invalid.

USDCHF

Dominant bias: Bearish

Since early February 2014, there has been a bearish signal in this market and the price has been going downwards in a slow and steady way. The price has gone down by around 350 pips; while rallies in the price have tended to proffer short-selling opportunities. The support level at 0.8700 has been tested and would be tested again. It could even be breached to the downside as the selling pressure becomes intense again.  

GBPUSD

Dominant bias: Bearish

Since February 17, 2014, the Cable has generally been in an equilibrium phase. Bullish and bearish signals tend to be short-lived, and therefore, intraday trading strategies are recommended. Right now, the market is showing some lack of stamina, and one could look forward to going short at 1.6650, targeting the accumulation territory at 1.6550.

USDJPY

Dominant bias: Bearish

All the JPY pairs have experienced sharp drops in the prices. This is in contrast to the significant uptrends that occurred last week. You see, when the Yen became very weak, the USD, the EUR, the GBP, the AUD, the CAD, the CHF and the NZD rose significantly against it.  When it is now very strong, those currencies drop against it. Since the Yen is a counter-cyclical currency, the economic issues in Japan would only strengthen the currency. The USD/JPY fell by close to 180 pips, testing the demand level at 101.50 before the price bounced upwards. The upward bounce is deemed as being temporary, for that demand level could be tested again and breached, as the price goes further downwards.

EURJPY

Dominant bias: Bearish  

This pair has recently dropped by over 250 pips, leading to a Bearish Confirmation Pattern in the chart. The supply zone at 142.00 is now a barrier to any sustainable rally in the market. The demand zone at 140.00 is a sensible target for the astute bears. The possibility exists that the price could even fall below that demand zone.

This forecast is concluded with the quote below:

                               

“Nowadays I take great comfort in knowing that I really know nothing about what the market will or could do. I just play the odds in favor as best I can, get out when I am wrong and stick with it when I am right. The market will always do what the market wants to do anyway.” – Sam Evans

Source: www.tallinex.com

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