Here’s the market outlook for the week:
EURUSD
Dominant bias: Bullish
This week, EURUSD assumed one of its strongest movements in recent times.
Since December 18, 2017, price has gained 800 pips. It gained almost 600 pips
in January 2108, and over 300 pips last week, almost reaching the resistance
line at 1.2550 (and pulling backwards). The market may go further upwards,
reaching the resistance lines at 1.2550 and 1.3000, but it would eventually
start coming down before the end of this week. The outlook on EUR pairs is
bearish for this week.
USDCHF
Dominant bias: Bearish
Since November 2, 2017, this pair has lost more than 700 pips; whereas
its most serious bearish movements within the past several months occurred in
January 2018. Last week witnessed the strongest bearish movement, as price went
south by 300 pips, testing the support level at 0.9300 and closing below the
resistance level at 0.9350. Since the outlook on USD is bearish for this week
and for February; and since the outlook on CHF is bright (bullish) for
February, it is expected that USDCHF would remain under bearish pressures. Only
a strong bearish movement on EURUSD can cause some rally on USDCHF, which may
even be weaker than normal.
GBPUSD
Dominant bias: Bullish
Last week price went upwards by 480 pips before the
bearish correction that is currently in place. The distribution territory at 1.4350 was
almost reached, before price pulled backwards. A strong bullish pressure is
needed before the distribution territory at 1.4350 can be tested again, and
breached to the upside. Nevertheless the 170-pip pullback that took place on
Thursday and Friday, may harbinger a protracted bearish movement, because the
outlook on GBP pair is bearish for this week and for February. Strong movement
would be witnessed again on GBP pairs.
USDJPY
Dominant bias: Bearish
The trend in the market is bearish – especially in January. Since the
beginning of the year, price has come down by 420 pips, leading to a huge
Bearish Confirmation Pattern in the market. Last week witnessed a movement of
240 pips, as price closed around the demand level at 108.50 on Monday. Further
bearish movement may help price test the demand levels at 108.00 and 107.50.
There could be instances of rally attempts this week, but they may be
insignificant, owing to the weakness of USD.
EURJPY
Dominant bias: Neutral
It is a surprise that EURJPY cross only went sideways last week, while
most majors trended significantly. This is a sideways (neutral) market, which
oscillates between the supply zone at 136.50 and the demand zone at 135.00
(though the demand zone at 135.00 was breached on Friday). Further sideways movement is possible, but
there will eventually be a breakout in the market, which would favor bulls.
GBPJPY
Dominant bias: Bullish
This is a volatile market. It has moved significantly upwards since
January 11. However, there was a noteworthy pullback on January 25 and 26.
Further pullback is possible, but may be contained at the demand zones of
153.00 and 152.00. Eventually, the recent bullish trend will continue because
the outlook on certain JPY pairs is bullish for February, and GBPJPY is also
included.
This forecast is concluded with the quote below:
“Trading requires an
optimal mindset. When you are upset, tired, and emotionally distracted, you
will have trouble following your trading plan. You must return to a calm,
focused mindset, a mindset where you are attentive and alert, and can trade
like a winner.” – Joe Ross
Azeez Mustapha
Market Analyst, Trading Signals Provider and Coach
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