Here’s the market outlook for the week:
EURUSD
Dominant bias: Bearish
As the beginning of last week, the pair saw a considerable increase
throughout its first and second days of trading. Price later dropped below the
resistance line at 1.1600, closing below it (and that signified a drop of more
than 170 pips from last week’s high). This month, the outlook on EUR pairs is
bullish, which means EUR would rise against most major currencies, thereby
reversing the current bearish bias on the market. However, EUR may not be able
to rally versus JPY.
USDCHF
Dominant bias: Neutral
The market has been moving sideways since June – hence the current
neutral outlook. Price has been moving between the resistance level at 1.0050
and the support level at 0.9850, at least on a long-term basis. For the neutral
bias to end, price would need to move out of these boundaries, and that is
expected to create a directional bias. However, it may take several trading
days (even a few weeks), for a strong, directional movement to occur. This is
because volatility in the markets would be generally low this month, save in
certain cases.
GBPUSD
Dominant bias: Bearish
The bias on GBPUSD is bearish and it would continue to be bearish, at
least for this week. Price ranged from Monday to Wednesday, and then dropped
further southwards on Thursday and Friday. The drop may continue this week, as
price targets the accumulation territories at 1.2950 and 1.2900 (which may even
be exceeded). A considerable amount of volatility will be witnessed on GBP
pairs, while volatility will be low on most other pairs.
USDJPY
Dominant bias: Bullish
The situation on this trading instrument is tricky. It is bullish in the
long-term, but neutral in the short-term. The bullish bias will soon change to
a bearish bias (while the short-term neutrality will evaporate), because the
outlook on JPY pairs is strong bearish for this week, and for the whole month
of August. In fact, price is expected to shed a minimum of 300 pips this month,
reaching the demand levels of 110.00, 100.00 and 109.00.
EURJPY
Dominant bias: Bearish
The market initially went upwards, reaching the supply zone at 131.00.
Nonetheless, further upwards movement is rejected at that supply zone as price
slid downwards by roughly 240 pips, closing near the demand zone at 128.50 on
Friday. Since there is Bearish Confirmation Pattern in the market, further
downwards movement is anticipated this week, which would enable price to reach
the demand zones at 128.50, 128.00 and 127.50.
GBPJPY
Dominant bias: Bearish
There is a “sell” signal in the market. Price first went upwards by 150
pips last week, reaching the supply zone at 147.00. It even moved slightly above
that supply zone before dropping by 240 pips; hence the “sell” signal. Given
the weakness of GBP, and the bearish outlook on JPY pairs, the most probable
movement this week, is downwards. The demand zones at 144.50, 144.00 and 143.50
would easily be reached.
This forecast is concluded with the quote below:
“Trading in itself is
a thrilling activity, and many non-traders never have a chance to experience
that level of excitement.” – Andy Jordan
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