In this weekly Forex forecast, I’m going to show you exactly how I’m trading EURUSD, GBPUSD, USDJPY, USDCAD, and XAUUSD through July 3, 2020.
Watch the video below, and be sure to scroll down for more commentary and annotated charts.
The EURUSD gave up the 1.1230 support level last week after breaking above it on June 22nd.
However, buyers managed to hold the euro above the falling wedge resistance I mentioned in last week’s forecast.
That area comes in near 1.1200.
The choppiness here is representative of the FX market as a whole.
June has presented very few favorable opportunities, in my opinion.
That said, the biggest moves usually follow long periods of consolidation and indecision.
A view of the EURUSD monthly time frame or even the USDJPY chart below confirms that notion.
As for where EURUSD goes this week, all I can say is that support comes in around 1.1150 with resistance at 1.1230.
Other than that, the euro needs to clear this congestion for me to take any interest in a position.
GBPUSD ended last week where it started.
Following a 200 pip rally between Monday and Tuesday, sellers took over to close the pair at breakeven for the week.
Notice where GBPUSD encountered selling pressure, though.
I’ve mentioned the 1.2500 resistance area for the last couple of weeks.
As for support, I think the 1.2240 region will attract buyers based on the two levels in the chart below.
But just like EURUSD, I don’t see any favorable opportunity here.
Perhaps a daily close below 1.2240 would be enticing, but for now, I’ll stay on the sideline.
The USDJPY monthly chart below is all that matters for the pair, in my opinion.
The daily and even weekly time frames are too choppy to make any reasonable assumptions about the market’s likely future direction.
I’ve mentioned this wedge before, including in my June 2nd post.
Notice that last week bounced at the 106.00 handle, which is the exact location of wedge support.
As for which way USDJPY will break, it’s too early to tell.
I thought the market was onto something in early June, but buyers were unable to follow through.
It’s going to take a monthly close above wedge resistance or below support to confirm the breakout.
Anything less won’t do.
USDCAD recovered nicely last week.
On June 12th, I wrote that USDCAD buyers needed to hold 1.3560.
That was the approximate location of descending channel support.
The pair dipped below 1.3560, but as you can see from the chart below, USDCAD held above channel support on a daily basis.
Key support for the week ahead comes in at the bottom of that recent range at 1.3560.
Resistance, on the other hand, is found at 1.3710 with a close above that taking on the confluence of resistance at 1.3860.
XAUUSD (gold) broke out from its sideways consolidation on Monday.
We’ve been anticipating a break higher given the uptrend that has been in place since late 2018.
Monday was the first daily close above 1740/50 (1747 to be exact).
You can see where XAUUSD then tested 1747 as new support on Tuesday and again on Friday.
Friday’s session even carved a bullish pin bar.
Things continue to look constructive for XAUUSD, and as I wrote on June 16th, gold bull markets tend to last for about ten years.
If we assume that 2016 was the start of this bull market, then gold could continue to shine for the next five or six years.
Key resistance for the week ahead comes in at 1800.
That’s a significant area dating back to 2011. It’s going to take a close above 1800 to expose gold’s all-time highs near 1900.
For the record, XAUUSD is about the only thing favorably respecting its technicals with the exception of maybe GBPNZD.