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Weekly Forex Forecast (July 17 – 21, 2017)

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EURUSD bulls had some difficulty last week but managed to land in positive territory. The pair is now up more than 1,100 pips for the year and doesn’t look ready to give up those gains just yet.

However, buyers need to deal with the 1.1470 handle if they want to extend this rally. A close above this area would expose the next key level at 1.1615.

To the downside, buyers will likely find support near 1.1300. This was the June 14th spike high and also attracted a bid during the July 5th session.

Keep in mind that this Thursday, July 20th is the ECB rate decision at 7:45 am EST. The event is followed by a press conference by Mario Draghi at 8:30 am EST, the same time the U.S. releases unemployment claims, so do expect an increase in volatility around those times.

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EURUSD range

The GBPUSD surged higher on Friday to retest the 1.3100 handle. It marks the highest price for the pound sterling since September of last year.

If buyers can pick up where they left off on Friday, we could see resistance at 1.3100 give way over the coming sessions. However, given Friday’s over-extension, I wouldn’t be surprised to see a pullback into 1.3020 and perhaps even 1.2980.

A close above 1.3100 resistance would expose 1.3250. This area was a key pivot for the pair between July and September of last year.

GBPUSD daily chart

The USDJPY has clawed back 570 pips of recent losses on the back of the rebound that began in mid-June. However, last week’s retest of the May high at 114.30 proved too strong for buyers.

Not only did the pair lose significant ground last week, but it also closed back below the key horizontal level at 113.15/25. You can see from the chart below how this area served as support between the 4th and 13th of July.

From here I would suspect that any retest of 113.15/25 as new resistance will attract an influx of sellers. Key support for the week ahead includes 111.70/85 followed by 110.30.

It seems the USDJPY will remain range bound for now. As such, it’s probably a good idea to limit any expectation of a strong directional move as long as prices trade between 114.30 and 108.00.

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USDJPY breakdown

Surprisingly, the EURCAD is one of the best-looking currency pairs right now. The pair broke below trend line support that extends from the December 2015 low on Wednesday of last week exposing downside targets.

The break was a possibility I mentioned on July 7th. What’s interesting is that the two previous breaks on November 16, 2016 and April 24, 2017 triggered moves of more than 500 pips. We’ll have to wait and see if this third break has the same effect.

The EURCAD spent the final 48 hours of last week consolidating just above support at 1.4460/70. But without a rotation into new resistance at 1.4670/80, there isn’t much to do here.

I should also note that the mean (as measured by the 10 and 20 EMAs), resides just above 1.4670/80. So if we do get a retest of this area in the week ahead, I will be on the lookout for a selling opportunity.

EURCAD new resistance

The AUDNZD broke free from consolidation last week after dropping 400 pips beginning in mid-May. We discussed this pattern on July 5th as one that had potential to trigger a move higher.

Thursday’s retest of former resistance as new support is the reason I wanted to wait following Tuesday’s close above it. Any time the price gets away from the 10 and 20 EMAs like it did early last week I like to wait for a pullback to the mean before considering an entry.

Notice how the retest of new support as labeled in the chart below came right back to the 10 and 20 EMAs before rebounding higher.

For the week ahead, key support comes in at 1.0615. This is the location of two session lows from February 28th and May 10th. But given the 130 pips between Friday’s close and the mean, I wouldn’t be surprised to see some consolidation to start the new week.

Key resistance comes in at 1.0690 followed by the confluence of resistance near 1.0765.

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AUDNZD breakout

Leave a Comment:

12 comments
Chima says

How is 1,1250/80 support on your EURUSD Daily chart? Looks more like resistance to me.

Reply
    Thabiso says

    support becomes resistance(if broken)

    Reply
    Justin Bennett says

    It was resistance back in May/June; it’s now support.

    Reply
      nasrul says

      Flip area that mark 11250/80

      Reply
david hartikka says

u mentioned u were really happy with your broker and if any one want to know just email u.. Well i did but never heard back from you.. maybe you can let us know since u offered on your end.

Reply
    Justin Bennett says

    I’ve been out of town for a couple of days. If I haven’t responded to your email, I will soon.

    Reply
      shahadat hossain says

      u no tall sell or buy trand

      Reply
Oluwatimilehin Olusegun says

Great analysis

Reply
Mx says

Nice setups Justin good and simple and very clean charts.

Reply
mark says

nice , do you follow bitcoin , just left us a HUGE gap close opportunity , i wasn’t game to claim more than a 1/4 ,as I don’t normally trade it , and whole lot minimum trade . blessings MG

Reply
uffan says

How many your mail forcast i never count it, its really help me as newbe in forex trading and i always use it… Thank you very much justin. You are always be succes

Reply
Priceless says

JUSTIN YOU ARE GREAT WITH ANALYSIS. YOUR EURCAD ANALYSIS BELOW JUST HAPPENED AS YOU MENTIONED.

I should also note that the mean (as measured by the 10 and 20 EMAs), resides just above 1.4670/80. So if we do get a retest of this area in the week ahead, I will be on the lookout for a selling opportunity.

GOD BLESS

Reply
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