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Weekly Forex Forecast (March 4 – 8, 2019)

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EURUSD bulls had a strong start last week but lost momentum on Wednesday.

The final two sessions of the week carved long upper wicks, but I don’t see this as a selling opportunity.

For one, I don’t think the euro tested descending channel resistance as displayed in the chart below.

But the primary reason I’m not selling has to do with the pattern itself.

Selling within an established descending channel such as this can be a risky endeavor.

A descending pattern that develops after an extended move lower can be indicative of a short-term bottom.

Now, I’m not saying EURUSD has bottomed. Nor am I stating the pair is a buy.

I don’t have enough information to state either with any degree of confidence.

What we do know is that EURUSD has been in a downtrend since the February 2018 high. There’s no arguing that point.

However, the bearish momentum has also slowed since November of last year.

In situations like this, I find it best to either limit expectations by trading the smaller ranges that develop or stay out of the market entirely.

I have no interest in trading indecisive price action, so I tend to look elsewhere for opportunities.

The EURUSD is going to need to return to 1.1215 support or break 1.1400 resistance on a daily closing basis to pique my interest.

Until that time, the EURUSD will continue to be a difficult pair to trade.

IMPORTANT: I use New York close charts so that each day closes at 5 pm EST.

Click Here to get access to the same charts I use.

EURUSD descending channel on the daily chart

Last Wednesday I discussed the possibility of a 1.3440 print for GBPUSD.

The pair was well on its way at the time, especially after clearing the 1.3200 resistance area the day before.

However, the rally was overcooked in my opinion. Bulls needed a pullback to help attract fresh bids.

Here’s what I wrote on Wednesday of last week:

The GBPUSD is too far extended to think about buying up here, at least in my opinion.

However, a rotation lower to 1.3200 support could offer a favorable buying opportunity.

That turned out to be the right call. GBPUSD lost ground on both Thursday and Friday before testing 1.3200 support before the weekend.

That 1.3200 level needs to hold on a daily closing basis for buyers to have a chance at a 1.3440 retest.

If the pair closes the day below it, we could see selling pressure intensify.

One way to help stack the odds in your favor in situations like this is to wait for bullish price action such as a pin bar or engulfing pattern.

Either formation would suggest that GBPUSD bulls intend to defend 1.3200.

GBPUSD key horizontal levels

USDJPY looks poised to take on the 112.50/60 resistance area this week.

It comes following Friday’s close above the 111.40/70 area I pointed out on Friday.

Before I go any further, I want to clarify something…

Key support and resistance levels break all the time.

Just because I post a chart showing a resistance area as I did last week with USDJPY does not mean it is a sell.

Nor does it suggest the level will hold.

I use these key areas coupled with the daily close to determine a market’s likely future direction.

In the case of USDJPY, it was simple.

A daily close above 111.70 would open the door to 112.50/60 while bearish price action from 111.40/70 would likely take the pair lower.

I stated that exact outlook on Friday with a note about how I was staying neutral through Friday’s close.

Here’s what I wrote:

The alternative would be a daily and weekly close above that upper resistance level of 111.70. Such a close would expose the next key resistance at 112.50.

I’m staying neutral here until I see where USDJPY closes today’s session.

Simply buying and selling at support and resistance respectively is not enough. If it were, profiting in the Forex market would be relatively easy.

And we all know that isn’t the case.

As for USDJPY, I do suspect buyers will want to defend the 111.40/70 area this week which is now serving as support.

But given the distance between Friday’s close and the 10 and 20 EMAs, I’d expect a pullback of some sort this week.

As for me, I want to see bullish price action in the 111.40/70 area before considering a long.

As I mentioned last week, the 112.50/60 area is the next resistance level.

Get 40% Off Lifetime Access to Justin’s Forex Course – Ends March 31st!

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USDJPY new support area

Remember the 84.50 resistance area on CADJPY?

I pointed out this area on the 25th of February.

The reason I continue to like the 84.50 area is that it’s the former ascending channel support that extends from the 2016 low.

You may recall how this former channel support triggered the 600-pip selloff last December.

As we know, old support becomes new resistance.

That means last weeks retest of 84.50 was likely to encounter selling pressure.

Here’s the weekly chart I posted last Monday:

CADJPY ascending channel on weekly time frame

CADJPY did manage a high of 85.23 on Friday, but it turned out to be the last gasp from bulls.

I sold the pair at 85.06 which I announced in the member’s area.

As for key support on the way down, there is an area at 83.80 that could attract a few buyers.

However, if sellers can follow through on this bearish rejection candle, there isn’t much in the way of support until the 82.00 area.

Below that we have the lows from April 2017 and March 2018 at 80.55.

Given how choppy CADJPY has been this year, I wouldn’t be surprised to see another retest of the 84.50/60 resistance area this week.

But as long as this new resistance at 84.50/60 is intact on a daily closing basis, I will stay bearish CADJPY.

CADJPY bearish rejection candle at resistance

On February 20th I wrote about a key resistance area for gold (XAUUSD).

It wasn’t immediately apparent, but gold was testing rising wedge resistance at 1345.

That same session carved a bearish pin bar. It was the first sign of weakness from gold bulls.

A few days later the market was testing the support area at 1320.

Then came the breakdown on the 28th of February.

For those who were already short from the signal on the 20th, the daily close below wedge support on the 28th offered a chance to add to shorts.

The break of rising wedge support ended up being costly for gold bulls.

Friday’s session took the market well below the next key support at 1300.

However, you will recall that my target here wasn’t 1300 but rather the wedge inception point at 1280.

Here’s what I wrote last Thursday:

If sellers manage a daily close (New York 5 pm EST) below 1318, we could see gold slide lower toward the 1300 support region.

In fact, if 1318 gives out this week, I would suspect we will see gold move lower toward the wedge inception point at 1280.

With gold closing last week below the 1300 handle, any retest of the area will likely encounter an influx of selling pressure.

In other words, watch for short opportunities from 1300.

To the downside, we have the 1280 support area followed by 1260.

IMPORTANT: I use New York close charts so that each day closes at 5 pm EST.

Click Here to get access to the same charts I use.

XAUUSD rising wedge pattern

Leave a Comment:

69 comments
Abel Nyoni says

You really make forex trading so simple.I follow your analysis everyday.Thank you for ‘guiding’ us.

Reply
    Justin Bennett says

    You’re welcome. It’s my pleasure.

    Reply
Ali asad says

Good great live long Justin and happy

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    Justin Bennett says

    Cheers, Ali. Have a great week.

    Reply
Qvee says

Thank you for insight. Learning daily. Appreciated.

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    Justin Bennett says

    You’re welcome. Pleased to hear that.

    Reply
Matt says

Really appreciate your weekly analysis, thank you…I’ve learnt a lot about how to analyse charts from you.

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    Justin Bennett says

    Anytime, Matt. Let me know if you have questions.

    Reply
Abdullah Ali says

Thank you for the guidance Justin. Really help a lot.

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    Justin Bennett says

    You’re welcome.

    Reply
Emuobo says

As usual thanks….

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    Justin Bennett says

    My pleasure.

    Reply
Henryk says

Dziękuję Justin,śledzę twoje wpisy które są pomocne przy opracowywaniu planu inwestycyjnego.Pozdrawiam

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    Justin Bennett says

    English, please. Use Google translate if you must. 🙂

    Reply
NiZa says

Your deliveries are highly insightful. Thank you for this unrelenting effort at keeping your readers abreast with key market info. Thank you for your benevolence.

Reply
    Justin Bennett says

    You’re welcome. Just glad it’s helping. 🙂

    Reply
Din says

Great analysis… Thanks

Reply
    Justin Bennett says

    You’re welcome.

    Reply
benjamin says

Hey Justin, I’ve been following up on your analysis but not taking the trades just to see how they pan out. I’m really blown by the accuracy and honesty. Hope to jump in from this week. Appreciate the effort and time you put in. Hopefully I’ll be a paid member soonest))

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    Justin Bennett says

    Cheers, Benjamin. Thanks for following along. Let me know if you have any questions.

    Reply
aaisha says

why do you think the 111.40 70 area to consider

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    Justin Bennett says

    Take a look at the daily price action going back to early 2017.

    Reply
      aaisha says

      can you elaborate this plz?

      Reply
walter says

GREAT STUFF! i monitor everyday

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ramzy says

Your analysis is an educational lesson for me. Thank you

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    Justin Bennett says

    You’re welcome.

    Reply
Linda says

Justin do you still run webinars?

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    Justin Bennett says

    Not at the moment.

    Reply
Anas says

Thank you Justin for your assistance… it will help me a lot to make good entries and exits in trading..
thank you

Reply
    Justin Bennett says

    You’re welcome.

    Reply
Ezeadim says

Thank you very much for your analysis. Looking forward to the day I join your group. Thanks again.

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    Justin Bennett says

    You’re welcome. We look forward to having you as a member.

    Reply
CHARLES says

Great analysis

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    Justin Bennett says

    Thanks, Charles. Have a great week.

    Reply
nadzuah says

thank you i always follow your analysis

Reply
    Justin Bennett says

    My pleasure. Thanks for the support.

    Reply
Eric says

Great tips…

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    Justin Bennett says

    Cheers, Eric.

    Reply
Samuel Odunlami says

Hi Justin. I’ve been following you for ages. How can I trade with you?

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Uzoma Nnamdi says

Thank you sir for the available pairs for the week

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    Justin Bennett says

    You’re welcome, Uzoma.

    Reply
Themby says

Thanks Justin. Your analysis is very helpful on the pairs I’m trading. Keep on keeping on. You’re the best!

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    Justin Bennett says

    Thanks, Themby. I appreciate that.

    Reply
Nkosi says

Great analysis

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    Justin Bennett says

    Thanks, Nkosi. I have a feeling March will produce much better setups than February or even January.

    Reply
Andrew says

Thank you very much for your analysis.

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    Justin Bennett says

    You’re welcome, Andrew.

    Reply
Edmond Attachey says

This analysis is the best for me so far. Keep up the good work prof

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    Justin Bennett says

    Glad to hear that.

    Reply
AMIN MALIK says

Mr.JUSTIN ! Thank you so much. You are a true GENTLEMAN —doing a commendable service to Trading Community at large. Stay blessed. Rgds

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    Justin Bennett says

    My pleasure, Amin. Thanks for your support.

    Reply
alex says

Justin thank you for making trading so understandable.

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    Justin Bennett says

    My pleasure, Alex. Glad to know you’re finding it helpful.

    Reply
Itoro Ekpe says

Over time I’ve seen this key areas play out. Your knowledge of price action is exceptional. Thank you

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    Justin Bennett says

    Thanks, Itoro. Let me know if you have questions.

    Reply
Adebayo saheed says

A day can never pass by without learn from you…thank you so much u are great mentor

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    Justin Bennett says

    And thank you for following along. Have a great week.

    Reply
Tlai says

Thnx very much for showing us hw makerts mives, u doing very gud for me thnx

Reply
    Justin Bennett says

    You’re welcome.

    Reply
POLA P says

i like this:::”Just because I post a chart showing a resistance area as I did last week with USDJPY does not mean it is a sell.”

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    Justin Bennett says

    That’s probably the most important sentence in this entire post. I have no doubt that many who follow me blindly buy at support and sell at resistance without reading my comments. That’s a mistake.

    Reply
Ridwan says

Thanks. But how come you were able to trade Cadjpy from that price? Do you trade it from intra day charts?

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    Justin Bennett says

    Hi Ridwan, I only share that information with Daily Price Action members.

    Reply
Emeka says

Good job Justin, how do i join the paid group

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TUNDE AJIBEWA says

I always look forward to receiving your mails and to learn new things, thank you for the insight.
Please i will like to know more about your membership program.

Reply
    Justin Bennett says

    Sure, see the link I just posted above.

    Reply
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