Here’s the market outlook for the week:
EURUSD
Dominant bias: Bullish
This pair edged higher last week, reaching the resistance line at 1.1900,
before the pullback that is currently being experienced. Price has gained more
than 1000 pips since early May 2017, and the trend for this year has generally
been bullish. The pullback may end up giving a good opportunity to buy long at
better prices, in the context of an uptrend (for the outlook on EUR is bullish
for this week). Price could thus target the resistance lines at 1.1800, 1.1850
and 1.1900.
USDCHF
Dominant bias: Bullish
A recent weakness in CHF has made USD/CHF go upwards, resulting in the
current bullish bias. However, the bullish bias is currently precarious, for
price merely consolidated last week, closing above the support line at 0.9700.
Further consolidation this week would result in a neutral bias, unless price is
able to breach the resistance level at 0.9750 to the upside, closing above it.
On the other hand, a movement below the support level at 0.9550 would result in
a bearish bias, which may happen in case CHF gathers bullish momentum (a
possibility).
GBPUSD
Dominant bias: Bullish
GBPUSD is bullish, but there is a threat to the
bullishness. As the market moved in a positive correlation with its EURUSD
counterpart, its price was able to go up last week, testing the distribution
territory at 1.3250, before there was a considerable pullback on Thursday and
Friday. From the high of last week (1.3262),
price dropped 210 pips, closing below the distribution territory at 1.3050
(hence the threat to the bullish bias). The threat may increase as price goes
further southward, as the outlook on GBP pairs is bearish for this week. The
accumulation territories at 1.3000 and 1.2950 could be breached easily.
USDJPY
Dominant bias: Bearish
Here is a bear market, with a clear Bearish Confirmation Pattern in the
market. Price has been going southwards in a slow and steady manner, having
lost 430 pips since July 11. The market bounced upwards on August 4, but that
pales into insignificance when compared to the overall bearish bias. This week,
the bearish journey would continue - owing to the ongoing bearish expectation
certain JPY pairs. The initial target is the demand level at 110.50, then
followed by the demand level at 110.00 which was also tested last week.
EURJPY
Dominant bias: Neutral
The neutrality on this trading instrument continued last week. Price
attempted to stay above the supply zone at 131.00, but the attempt proved
abortive. Had the attempt succeeded, a bullish signal would have been
generated. The weakness that was seen in the last few days of last week has
only put more emphasis on the neutrality of the market. One factor preventing a
serious bearish movement in this market is the stamina in EUR, and therefore,
there may not be a big pullback until EUR undergoes exponential weakness.
This forecast is concluded with the quote below:
“Be proud you're a
trader. A trader is a man who earns what he gets and does not give or take the
undeserved. A trader does not ask to be paid for his failures, nor does he ask
to be loved for his flaws. A trader does not squander his body as fodder, or
his soul as alms. Just as he does not give his work except in trade for
material values, so he does not give the values of his spirit - his love, his
friendship, his esteem - except in payment and in trade for human virtue, in
payment for his own selfish pleasure, which he receives from men he can
respect…” - Ayn Rand
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