AUD/USD Weekly Price Forecast – Aussie struggles during the week

The Australian dollar has broken down rather significantly during the week, slicing through the uptrend line, and then breaking below the psychologically important 0.75 handle. This is a very negative sign, and I think it’s only a matter of time before we go lower. When I look at the weekly chart, it’s obvious that there is a significant amount of support based upon the hammers, and I think that if we break down below is hammers it’s likely that this market will break down. The fact that we closed so lowly, that signifies that the market is extraordinarily soft, and it’s likely that we will continue to go much lower based upon that. Beyond that, there are trade sanctions being levied on the Chinese by the Americans, and of course the Chinese will retaliate.

This will directly affect Australia as it is so highly levered to the Asian economies. I think it’s only a matter of time before we go looking towards the 0.7350 level, and then possibly even lower than that. However, if we wipe out the weekly candle that we just formed, it’s likely that we would turn around and go much higher. However, this doesn’t look very likely to happen based upon the extreme negativity of the clothes, so I think it’s only a matter time before the sellers get rewarded. At best, I’m looking at this market for consolidation.

EUR/GBP Weekly Price Forecast – continued consolidation

The EUR/GBP pair continues to grind sideways overall, and I think that it is likely that the longer-term traders are on the sidelines as we don’t have any significant amount of clarity when it comes to this market. Short-term traders continue to push this market back and forth and there are a lot of traders that will be looking to go back and forth in short burst, but as far as holding onto the market for a significant move, we need to get some type of resolution between the European Union and the United Kingdom as far as exiting is concerned.

Until we get to that point, I think this market remains sideways overall, and if we did break above the 0.8833 level, then the market could go to the 0.90 level above there. Otherwise, if we break down below the bottom of the weekly candle, we could roll over towards the 0.86 level after that. Overall, this is a market that is very lackluster for longer-term traders, but again, I believe that short-term traders will continue to flock to it. If we do get some type of move in the negotiations, then we can put money to work. Until then, longer-term traders are best served by leaving this pair alone as we just don’t have any clarity as far as direction is concerned. Beyond that, headlines can continue to slap this pair around as an errant comment from a politician could move things.

EUR/USD Weekly Price Forecast – Euro falls during week testing support

The EUR/USD pair fell significantly during the week as the ECB suggested that interest rate hikes are coming until summer of 2019, and that means that the Euro may have been overvalued to begin with. The 1.15 level has been massive in its importance, as we formed a huge camera there from a couple of weeks ago, and it was massive resistance previously. The 50% Fibonacci retracement level has offered support as well, so I think it’s very interesting to see that we did bounce there. However, we wipe down a lot of that support over the last week, so I think that it’s only a matter of time before we get some type of answer.

If we continue to see a lot of headlines crossing the wire’s as far as trade wars are concerned, it’s likely that we will continue to see a lot of choppiness in this general vicinity. A break down below the 1.15 level would be very negative, as it would not only wipe out a large come around, psychologically significant number, but it would also wipeout the bottom of a hammer. Overall, this is a market that is testing a very serious level, and it will be very interesting to see whether that level holds. This last week was of course very negative, so it best I think we’re looking at consolidation, at worst we are looking at a break down just waiting to happen. If we do turnaround from here, we need to take out this week’s candle before buying.

GBP/JPY Weekly Price Forecast – British pound noisy against Japanese yen as trade fears dominate

The British pound went back and forth or the week, forming a slightly negative candle, and it looks likely that we will continue to be very choppy and erratic. The ¥145 level underneath is massive support, of course demonstrated by the massive hammer that formed a few weeks previously. I believe that the ¥150 level above is resistance, and quite frankly this market is going to move based upon headlines involving trade wars and possibly even economic growth.

Pay attention to stock markets, they have a remarkable insight as to how the economy is going and will quite often lead where this pair goes. For example, if the S&P 500 continues to drop, then this pair will continue to draw. Obviously, the exact opposite can be true as well. If we break down below the hammer from three weeks ago, then I think the market goes looking towards the ¥140 level. Otherwise, if we can reach towards the ¥150 level and finally break above it, then we could go to the ¥155 level. This is a market that is definitely at risk of breaking down, but I think keeping a small position on and then adding if it moves in your favor is probably the best way to approach this market. Expect choppiness and dangerous conditions.

GBP/USD Weekly Price Forecast – British pound falls during the week

The British pound has fallen significantly during the week, slicing through the 1.33 level. That’s an area that offered support more than once, as well as resistance. It’s the 38.2% Fibonacci retracement level of the recent march higher, and I think at this point if we break down below the candle for the week, the market is probably going to go down to the 1.30 level, which is substantively the 50% Fibonacci retracement level. Otherwise, if we can break above the top of the candle for the week, that could send this market looking towards 1.3650 level above which has been resistance in the past.

Overall, I think that it will be interesting to see how this market plays out, but it seems as if it is following the EUR/USD pair, which has been very noisy as well. We still have the negotiations between the United Kingdom and the European Union as well, and that of course will have an influence on where the British pound goes over the next several months. In general, this could become more of a “risk on/risk off” type of trade and paying attention to global markets and headlines could be the easiest way to trade this market. If we can break above the top of the weekly candle, then I think we could go higher, and could lead the way for continuation of the uptrend that started late 2016. If we break below this candle, then I think the uptrend is in serious trouble.