In this weekly Forex forecast, I’m going to show you exactly how I’m trading EURUSD, GBPUSD, EURGBP, EURCAD, and VETUSD through July 24, 2020.
Watch the video below, and be sure to scroll down to see the charts and key levels for the week ahead.
EURUSD bulls just capped off an impressive week.
I first mentioned this descending channel, which is also serving as a bull flag pattern on June 29th.
The July 6th close above resistance confirmed the breakout and exposed the 1.1350 resistance level.
That’s the area I mentioned last weekend.
As anticipated, EURUSD broke above 1.1350 last Tuesday, which opened the door to the channel’s inception point at 1.1420.
Notice how Wednesday formed what appeared to be a bearish pin bar.
However, as I told DPA members on Wednesday, that was not a favorable selling opportunity.
If you look closely, Wednesday’s session actually closed above Tuesdays, indicating that buyers were still in the driver’s seat.
The euro’s immediate path forward will depend on how Monday opens.
If EURUSD holds above 1.1420, we could see a quick run to 1.1500.
If it doesn’t, we will likely see more sideways movement above 1.1350.
I remain long here from 1.1299 and will continue to hold that position as long as 1.1350 holds as support.
GBPUSD is much less attractive than its euro counterpart.
If you saw last weekend’s video, you know that 1.2530 was (and still is) support.
Notice how sellers tried to take out 1.2530 several times last week, but buyers held their ground.
That leaves us in a similar situation for the week ahead.
It’s going to take a daily close above the 1.2640 resistance area to expose the 1.2800 region.
Alternatively, a daily close below 1.2530 would indicate weakness and expose channel support just below 1.2400.
I wrote about EURGBP on July 16th.
That post focused mainly on what appears to be a false break below a long-standing trend line.
Notice how EURGBP closed below that trend line on July 7th.
However, last week’s rally put the pair back above that level.
As I often say, a false break to one side of a structure often triggers an extended move in the opposite direction.
Sure enough, EURGBP bounced right from (new) trend line support near 0.9050 last week.
But buyers failed to close the pair above 0.9100.
That’s the resistance level I pointed out last week.
For the week ahead, I’ll be watching to see if buyers can close EURGBP above 0.9100, followed by 0.9150.
Do that, and I think the market is headed toward 0.9300.
On the flip side, a daily close below 0.9050/70 would signal weakness and negate the entire idea.
EURCAD played out perfectly for us last week.
In the last weekly forex forecast, I mentioned how a break above wedge resistance would target 1.5530.
That’s exactly what happened last week.
Notice how EURCAD stalled at 1.5530 after breaking above wedge resistance on Monday.
The pair’s future direction will depend on whether or not buyers can clear 1.5530 on a daily closing basis.
If so, we could see EURCAD test the top of the ascending channel.
On the other hand, if 1.5370 support fails, we could see EURCAD move toward the 1.5000 handle.
I first discussed VeChain on June 26th when VETUSD was trading at 0.0088.
By July 8th, VET was trading above 0.02, representing a 150% gain in a little over a week.
I even wrote about the breakout from wedge resistance on July 1st when it was still trading under 0.01.
If you missed those two posts, VeChain looks to be gearing up for its next rally above 0.02.
Notice how VETUSD is holding above 0.017 support on a daily closing basis and continues to put pressure on 0.02 resistance.
Also note how volume has decreased during consolidation.
That’s a positive sign as it illustrates a consensus between buyers and sellers that VeChain’s new valuation is warranted.
As stated in today’s video (above), a daily close above 0.02 would expose 0.028.
And an eventual breakout above 0.028 would put VET in price discovery mode as it’s never been above that mark under its current economic model.
As a reminder, I’m invested in VeChain, not trading it as I believe the long-term appreciation will far outweigh any short-term gains from trading the asset.
Disclaimer: I hold a long position in VeChain.