Weekly Trading Forecasts on Major Pairs (July 18 - 22, 2016)

EURUSD
Dominant bias: Neutral
This market merely went flat throughout last week; neither closing above the resistance line at 1.1150 nor going below the support line 1.1000. Price went lower on July 15, but it is unlikely that the support line at 1.1000 would be breached, for price may not be able to close below the support line, even after it tests it. This week, the probability of price going north is higher than the probability of it going south. Therefore, the resistance lines at 1.1200 and 1.1250 could be tested this week.

USDCHF
Dominant bias: Bullish
In spite of attacks from bears, USDCHF was able to avoid a significant decline last week. Price managed to go above the resistance level 0.9850, but it could not reach the subsequent resistance level at 0.9900 (which is a strong barrier to the bullish movement). Price underwent a shallow bearish correction on Wednesday and Thursday; while the bias remains bullish. There ought to be further bullish movement this week….. But…. There two threats against the current bullish outlook: 1). CHF could become strong any time this month. 2). USD may become weak versus other major currencies before the end of this week. Until one of these two threats materialize, USDCHF would continue trudging upwards.

GBPUSD
Dominant bias: Bearish
Just as it was forecasted, GBPUSD pair made some conspicuous effort to rally last week, without being able to overturn the bearish outlook on it. Other GBP pairs also rallied significantly, like GBPNZD (1100 pips) and GBPJPY (1300 pips). GBPUSD went north by 550 pips, topped at 1.3480, before the current pullback began. A bullish signal has been generated in the hourly and 4-hour charts, whereas the overall bias remains bearish on higher timeframes. GBPUSD might be able to go further upwards this week; and the bias could turn bullish in case the rally is quite strong.

USDJPY
Dominant bias: Bullish
Contrary to expectation, USDJPY pair went upwards significantly last week (just as other JPY pairs did). Price went north 550 pips, ramming into the supply level at 106.00, before getting corrected on Friday. There is a now a Bullish Confirmation Pattern in the chart, which means that further upwards movement is possible. The only possible impediment to the current bullish effort is a possible weakness in USD, which might result in a considerable selling pressure.

EURJPY
Dominant bias: Bullish
This cross underwent a bullish movement of more than 700 pips last week, enforcing a Bullish Confirmation Pattern in the 4-hour chart. Although price got corrected by over 200 pips on Friday, July 15, the Bullish Confirmation Pattern remains valid. This means price might go further upwards this week, though threats from bears have not abated. Only a movement below the demand zone at 114.00 would render the bullish outlook useless.

This forecast is concluded with the quote below:

“We believe in never trying to “take” or force the market, only “accept” what it gives you.” – Joe Ross

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