Weekly Forex Forecast (May 6 – 10, 2019)

by Justin Bennett  · 

May 6, 2019

by Justin Bennett  · 

May 6, 2019

by Justin Bennett  · 

May 6, 2019

Important: This site uses New York Close Forex Charts so that each 24-hour session starts and ends at 5 pm EST. These charts are essential for trading price action.

The EURUSD continues to chop around this week without much direction.

This has been the theme throughout 2019.

In fact, the euro hasn’t been the most favorable currency pair to trade since this time last year.

More recently, it seemed the 1.1180 area would serve as new resistance after the pair dropped below it on April 24th.

But the market wasn’t having it.

I didn’t short EURUSD at 1.1180, though, due to the increased demand below the area.

I wrote about this on April 30th on this website and even mentioned my intentions to Daily Price Action members on April 26th.

And it’s a good thing we didn’t short EURUSD at 1.1180 given last week’s 80+ pip surge above the area.

I’m not a fan of trading EURUSD at all right now.

The trend is still bearish, but the price action is less than favorable.

Furthermore, the pair isn’t respecting key levels the way I’d need to see in order to consider a position.

For those reasons, I’ll leave EURUSD alone for now.

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EURUSD support and resistance levels

Was Friday a false break for GBPUSD?

It looks that way at the moment.

On May 1st, I wrote about a channel on GBPUSD that could give buyers a run for their money.

Sure enough, the pair carved a bearish pin bar that same day after tagging the 1.3100 resistance area.

Friday’s session erased that idea, though. Buyers also closed the pair back inside the ascending channel that extends from the February low.

But any shorts here should have been able to get out at breakeven or better.

That’s especially true if you got in on a 50% retrace of Wednesday’s pin bar.

And as for Friday’s close back inside this channel, it isn’t something I would want to buy.

One of my rules is to never buy upside breaks of ascending levels or sell downside breaks of descending ones.

These are considered “weak” breakouts. Friday’s close was no different.

So, for now, it’s going to come down to today’s close at 5 pm EST. A close below 1.3110 would be bearish for GBPUSD.

Alternatively, a daily close above 1.3110 would keep the short-term rally intact a while longer.

GBPUSD ascending channel on the daily chart

Today’s gap down on the USDJPY could leave the pair vulnerable this week.

I’ve written about the 111.00 handle for the last few weeks now.

It isn’t a level that has provided a ton of longer-term directional cues, but it has served as a pivot for the market since late 2017.

That’s especially true since February of this year.

If the USDJPY closes today below 111.00, we could see the area attract an influx of selling pressure.

Key support from there would come in at 109.70 followed by 108.70.

Alternatively, a daily close back above the 111.00 handle would keep buyers in the driver’s seat.

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.

USDJPY key horizontal levels

NZDUSD continues to trend lower inside a short-term descending channel.

I wrote about this pattern on May 2nd.

The short-term trend is still bearish here. However, sellers need to keep prices below channel resistance near 0.6630.

If NZDUSD closes above this 4-hour channel, we could see the pair march higher toward the 0.6720 region.

But as long as this descending channel is intact, range support at 0.6590 is exposed.

If that support level fails on a daily closing basis, we could be looking at another run at 0.6510 and perhaps 0.6430.

Regardless of where the pair goes from here, though, I think the 4-hour channel below is worth keeping an eye on.

The NZDUSD is one for my watch list, but not much more than that.

I don’t want to short the pair above range support at 0.6590.

At the same time, I’m not willing to play the 350 pip range as long as the price is below channel resistance.

With that in mind, I’ll remain a spectator until I have a reason to act.

NZDUSD descending channel

On April 25th I discussed how gold (XAUUSD) had a critical decision to make.

The market needed to decide whether it was going to break below the trend line from the 2018 low or above the trend line from the year-to-date high.

You can see where sellers tested trend line support on Thursday.

However, the 1270 close kept the level intact as support; hence Friday’s bounce.

This is why it’s essential to wait for a daily close below support or above resistance before considering an opportunity.

Go here to get access to the same New York close Forex charts I use!

These charts guarantee that each 24-hour session opens and closes at 5 pm EST which is required for trading price action.

That goes for any market, not just gold.

I have removed the 1280 horizontal level from my chart because, well, it doesn’t matter anymore.

In my opinion, the two trend lines below are what will decide the future direction for gold.

That means this market needs more time to decide what it wants to do.

I will say, however, that this latest retest of trend line support is indicative of weakness.

Notice how gold has tested support twice in the last couple of weeks but failed to reach trend line resistance near 1290.

In other words, supply appears to be outweighing demand below 1290.

But again, patience is key here.

And given the vast amount of real estate below support and above resistance, there’s no need to rush an entry.

There will be plenty of opportunities following the break from this terminal pattern.

A daily close below trend line support would first target 1240. A close below that would expose 1215.

Alternatively, a close above trend line resistance would open the door to 1320 and perhaps 1350.

Want to see how we’re trading these currency pairs and more? 

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Gold trend lines on the daily time frame

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  2. Hey Justin Great Analysis

    can we get associated with you through your members group

    let me know the process

    cheers !!!


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