Here’s the market outlook for the week:
EURUSD
Dominant bias: Bullish
Last week, this pair rose from the support line at 1.2250 and tested the
resistance line at 1.2550 (a movement of 300 pips). After the resistance line at 1.2550 had been
tested, price got corrected by 140 pips, closing below the resistance line at
1.2450 and now very close to the support line at 1.2400. The current bias on
the market is bullish, but that can change this week, because there is a strong
likelihood that EUR pairs would become very weak this week. Rallies would be
contained at the resistance line at 1.2550, and price could drop towards the
support lines at 1.2350 and 1.2300 this week. These targets could even be
exceeded.
USDCHF
Dominant bias: Bearish
USDCHF remained under strong bearish pressure last week. Price
consolidated on Monday, and started coming downwards on Tuesday, to reach the
demand level at 0.9200 on Friday. The upwards bounce that is in place was made
possible by a sharp pullback on EURUSD. Bearish attempts would be halted at the
support level of 0.9200; while price targets the resistance levels at 0.9300,
0.9350 and 0.9400. However, there could be a limited bullish movement because
USD would not be very strong this week.
GBPUSD
Dominant bias: Bearish
Cable is not currently in a bullish mode. The rally
that was witnessed last week might have led to a bullish bias if not for the
pullback that occurred on Friday. Price rose indeed – from the accumulation
territory at 1.3800, nearly reaching the distribution territory at 1.4150, but
further northward journey was halted. The distribution territory at 1.4150 has
already become a barrier to further bullish movement: The market is supposed to
move downwards this week. The outlook on GBP pairs is somewhat bearish for this
week.
USDJPY
Dominant bias: Bearish
USD/JPY was engaged in a smooth, clean bearish movement last week. Since
January 9, the market has gone downwards by 720 pips (losing at least, 300 pips
this month alone). There is a strong Bearish Confirmation Pattern in the
market, it is expected that price should be able to go below the demand levels
at 106.00, 105.50 and 105.00, and remain below it… The outlook on JPY pairs
remains bearish.
EURJPY
Dominant bias: Bearish
From the top of 137.50, this cross has nosedived by at least, 550 pips.
Last week, the movement of the market was a kind of choppy and sideways (in the
context of a downtrend), but bears were able to pull their weight, since price
closed below the supply zone at 132.00. The outlook on the market remains
bearish, and that might even be aided by a weak EUR. The demand zones at 131.50
and 131.00 are the initial targets for the week.
GBPJPY
Dominant bias: Bearish
On February 2, the market reach the monthly high of 156.50, and it has dropped
800 pips since then, reaching a low of 148.00. Although the market movement is
rough, the bearishness in the market is clearly visible. This week, the market
should continue moving southwards, but not without attacks from bulls (which
could cause temporary upwards bounces in). The targets for the week are located
at 148.50, 148.00 and 147.50.
This forecast is concluded with the quote below:
“A trading edge is
created by a harmonious combination of choices made by each trader to exploit
recurring market inefficiencies and thereby create a long-term mathematical
advantage. The unique objectives, beliefs, and skills of each trader are key to
all edge choices and to integrating the edge into an effective trading
methodology.” – VTI
Azeez Mustapha
Market Analyst, Trading Signals Provider and Coach
