Here’s the market outlook for the week:
EURUSD
Dominant bias: Bullish
There is a Bullish Confirmation Pattern on the market. Price went upwards
by 170 pips last week, almost managing to close barely above the support line
at 1.2000. While there could be further bullish effort this week, it is not may
not take price above the resistance line at 1.2100, because the outlook on the
market is strongly bearish for this week, and mostly bearish for January as
whole. Therefore, the days on the current bullish bias are numbered.
USDCHF
Dominant bias: Bearish
This trading instrument was vividly engaged in a bearish movement last
week, thus ending the short-term equilibrium phase that occurred around the
middle of December. The market dipped by 160 pips last week, closing below the
resistance level at 0.9750. Further bearish movement is expected this week,
which could take price towards the support levels at 0.9700 and 0.9650. USD
would try to amass some stamina sometimes this week, but that would not make a
significant bullish difference (until EURUSD dips), because CHF itself would
become strong versus many major currencies this month, and USD included.
GBPUSD
Dominant bias: Bullish
This pair, which was mostly moving sideways in
December, managed to start a bullish movement last week. A close above the
accumulation territory at 1.3500 means the sideways phase is temporarily over.
The bullish bias would hold out only as long as price is able to stay above the
accumulation territory at 1.3450. There would be strong movements on this pair,
as well as other GBP pairs, in January, and most of the movements would be
bearish.
USDJPY
Dominant bias: Bearish
USDJPY is bearish in the short-term, and neutral in the long-term. Price
consolidated on Monday and Tuesday, dropped on Wednesday, and maintained the
drop till end of the week. This is what has created the short-term bearishness
in the market. Since the outlook on JPY pairs is somewhat bearish for this
week, it is expected that the bearish movement would continue, thus targeting
the demand levels at 112.50 and 112.00.
EURJPY
Dominant bias: Bullish
Unlike what USDJPY did, EURJPY managed to go upwards last week, breaching
the demand zone at 135.00 and testing the supply zone at 135.50, before closing
below it. One factor responsible for this is the stamina on EUR, and there is a
possibility that price would be able to go above the supply level at 135.50
(even reaching another supply zone at 136.00 and moving above it as well).
However, risk of a large bearish run exists, since the outlook on most JPY
pairs is bearish for the week.
GBPJPY
Dominant bias: Bullish
This cross has been able to sustain the “buy” signal it generated in the
middle of December. The upwards movement is slow and gradual, and it may
survive as price gains another 100 pips this week. Nonetheless, there is a
possibility of a bearish movement starting before the end of the week – or
sometimes this month - for GBP could become week. Additional factor is also a
possible strengthening of Yen.
This forecast is concluded with the quote below:
“If traders cannot
accept the losses that go with the trading, they do not deserve the profits.
Failure is the greatest teacher only when a student is prepared to learn. If
the student has forgotten previous lessons, or the dog ate his homework, he is
not ready. A positive attitude has positive expectations of future events and
normally precedes the success it creates.” – Andy Jordan
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