Here’s the market outlook for the week:
EURUSD
Dominant bias: Bearish
The market lost about 200 pips last week, went briefly below the support
line at 1.1750 and then went above it, to close above the support line at
1.1800. There is already a Bearish Confirmation Pattern in the market, and
further downwards movement is possible as price targets the support lines at
1.1800, 1.1750 and 1.1700 this week. This means that the shallow rally that was
seen on Thursday and Friday may turn out to be opportunities to go short at
slightly higher prices. The outlook on EUR pairs is strongly bearish for
October; so EUR would be seen falling against other major currencies.
USDCHF
Dominant bias: Bullish
The bias on USDCHF is bullish in the short-term; and the bullishness is
even precarious. This week, it may be possible for this pair to retain its
bullishness as EURUSD slides southwards. However, the bullishness of the market
would face a challenge from another quarter, which is the expected rally in
CHF. CHF may begin to gain strength versus other currencies within the next two
weeks, and that may make it difficult for USDCHF to experience a smooth bullish
run. However, USD would also gain serious stamina around the end of October – a
factor that may help USDCHF to become a clear winner at the end of the month.
GBPUSD
Dominant bias: Bearish
GBPUSD was bullish in September, but the bearish
correction that was witnessed throughout last week (at least a movement of 150
pips to the south) has resulted in a “sell” signal in the market. The outlook
on GBP pairs is bearish for this week, and thus, long trades are not
recommended for now. GBPUSD could reach the accumulation territories at 1.3350,
1.3300 and 1.3250 within the next several trading days.
USDJPY
Dominant bias: Bullish
This trading instrument has gained at least 450 pips since September 11.
The movement of the market would largely be determined by whatever happens to
USD this month. A strong USD means price would continue going upwards, whether
gradually or swiftly. On the other hand, a weak USD may cause a serious
reversal on USDJPY as price goes downwards by at least 200 pips within the next
few weeks.
EURJPY
Dominant bias: Bullish
This cross dropped southwards on Monday and Tuesday and then consolidated
throughout the rest of the week. However, a closer look at the market reveals
that bulls have subtly moved price in their favor, leading to an invalidation
of recent bearish efforts. A movement above the supply zone at 134.00 would
result in corroboration of the recent bullish bias; while a movement below the
demand zone at 131.50 would result in a bearish bias.
GBPJPY
Dominant bias: Bullish
GBPJPY rose by 1,100 pips in September and got corrected on September 29,
following the consolidation that took place in most part of last week. The
correction was almost nothing when compared to the general bullish movement in
that month. Price could continue to go upwards – but only in a limited way –
owing to the expected weakness in GBP in October. This means that the market
would go down by at least, 400 pips in October, thereby invalidating the
current bullish bias.
This forecast is concluded with the quote below:
“Successful trading
careers start with plans that specify objectives, which in turn lead to
success. There are psychological benefits to establishing objectives and
developing plans to reach them.” – Joe Ross
