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In this weekly Forex forecast, I’m going to show you exactly how I’m trading EURUSD, GBPUSD, USDJPY, NZDUSD, and XAUUSD through March 27, 2020.
Watch the video below, and be sure to scroll down for more commentary and annotated charts.
The EURUSD played out perfectly for us last week.
If you watched last weekend’s Forex forecast video, you know that the recent false break above 1.1170 meant that a return to 1.0725 was likely.
That 1.0725 area was the open gap from April 2017.
Sure enough, Thursday’s session hit 1.0725 before bouncing by nearly 100 pips.
I pointed this out to Daily Price Action members on Thursday, noting that our target had been reached.
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However, notice that EURUSD closed below 1.0725 on Friday.
That points to further weakness this week, perhaps down to the next key support at 1.0520 and maybe even 1.0350.
As long as the EURUSD stays below 1.0750 on a daily closing basis, those two support levels remain exposed.
The GBPUSD has become too volatile to trade, in my opinion.
Friday’s session alone spanned over 500 pips.
It used to take the pair weeks to move that distance.
Another reason I’m not a fan of trading the GBPUSD at the moment is the fact that the pair is trading at all-time lows.
I said a move to all-time lows was likely in last week’s forecast, and sure enough, that’s what we got.
A market at all-time lows or highs makes for difficult trading conditions as it’s harder to determine support and resistance levels.
For the week ahead, we have the 1.2000 area serving as resistance with support coming in at 1.1450.
USDJPY is a prime example of market whiplash.
The February 27th close below 109.80 presented us with an incredible short opportunity, one I most certainly jumped on.
Following an 800+ pip dive that took just seven trading days, the USDJPY clawed back all of those losses and then some in eight sessions.
The aggressive turnaround formed a v-shaped recovery.
I wrote about this on Thursday.
I also stated that the 109.60/70 area was likely to serve as new support.
Friday’s session put in a low of 109.32 before rebounding higher by more than 200 pips.
As long as USDJPY remains above that 109.50 region on a daily closing basis, I have to respect the potential for further gains.
That said, I’m not buying this market until I see more from the pair.
I’m also not ruling out the possibility of another false break.
Key resistance comes in at 112.20 followed by 114.50.
Only a daily close back below 109.50 would negate the bullish scenario and turn our attention back to 108.50 and perhaps 106.80.
I wrote about the NZDUSD multi-year wedge pattern on March 10th.
I also pointed out the confirmed breakdown on the 13th.
What’s most impressive about this pattern is that wedge support extends from the 2000 lows, making it a twenty-year structure.
I entered short on March 10th, an entry I announced in the membership forums when the pair was trading near 0.6300.
I booked some of the profit last week, but I still have some on here.
As I wrote last week, the 0.5920 area was likely to influence the NZDUSD on the way down.
That 0.5920 level is now resistance.
Key support remains 0.5650, followed by the financial crisis lows near 0.8500.
Keep an eye on 0.5920 this week as any bearish price action from there could present an opportunity to get short.
Like most markets, the XAUUSD (gold) remained volatile last week, finishing between 1450 support and 1515 resistance.
So far, I don’t see signs of a rebound.
The only thing that would change my mind is if we get a sustained move above 1515 this week from XAUUSD.
Otherwise, a break below 1450 seems likely.
Key support below 1450 comes in at 1360/80, whereas a close back above 1515 would target 1550 and 1580/90.