Daily Price Action
Shares

Weekly Forex Forecast ( July 13 – 17, 2015)

Shares

The outlook for Greece remains uncertain and so too does the future direction of the EURUSD. But this is nothing new for those who have followed the happenings in Europe over the past six months.

In fact it has been more than six months since I have traded this pair as the risk has simply been too great. That and there have been plenty of other opportunities that have carried far less risk and have therefore been more appealing to trade.

If you insist on trading EURUSD do so cautiously as the drama surrounding Greece is far from over. There are bound to be more twists and turns as the saga unfolds over the coming weeks and months.

On a purely technical basis, the pair can be seen breaking key support on July 1st. The pair did find immediate support at 1.1050, however the relief was short-lived as the bears managed to push the market below the key level just days later.

Friday’s rally made a significant dent in recent weakness, however the pair continues to trade below key levels that must be overcome before any meaningful rally can be considered viable.

Summary: Watch for bearish price action on a retest of former channel support. Key support from current levels comes in at 1.1050, 1.0820 and 1.0658.

EURUSD broken level on the daily chart

GBPUSD made a significant break last week as the pair breached key wedge support along with the 1.5500 horizontal level. However a late-week surge of optimism over a potential Greece deal put the pair slightly above this level to end the week.

At first glance this looks bullish, but we have to remember that the pair was unable to hold wedge support during Tuesday’s session. This weakness could be enough to open the door for another retest of 1.5355 and possibly 1.5195 in the week ahead.

To the upside we have former wedge support along with the 1.5680 level that are likely to attract sellers if tested. Typically a break of a rising wedge such as this results in a retest of the pattern’s low, which comes in at 1.4580. Of course only time will tell if GBPUSD intends to be the exception to the rule.

Summary: Watch for bearish price action on a retest of former wedge support, now resistance. Key support comes in at 1.5500, 1.5355 and 1.5195.

GBPUSD broken support level on the daily chart

AUDCAD is a pair that continues to offer good potential but can’t quite seem to follow-through on said potential.

We have been tracking this pair for a couple of months now, more specifically we have been watching for a daily close below the .9410 area. The weekly chart shows the full-scale potential of such a break.

AUDCAD weekly descending channel

Of course such a lofty target would need to be accompanied by follow-through, and lots of it. The bearish sentiment needed to kick-off such a landslide has been absent as the pair has remained well bid at .9410 since December of 2013.

But all things must come to an end, and the .9410 support area is no exception. The question then becomes, how much longer can the pair hold out?

I’ll leave that up to the market to decide, but my guess is not long considering the downward pressure recently that continues to carve out lower highs.

Summary: Wait for a daily close below .9410 and then watch for a retest as new resistance. Key support comes in at .9210, 8984 and .8795. Alternatively, a break above short-term trend line resistance would open the door for another retest of channel resistance.

AUDCAD key support level

NZDCAD has been in a freefall since breaking a four-year support level in late May, losing more than 400 pips in the process.

A look at the daily chart since early April shows a descending channel that has been tested on several occasions. During Wednesday’s session it looked as though the pair would make a strong push to break resistance.

That rally was short-lived as the bears stepped in to stall the advance during Thursday’s session, selling pressure that would eventually carve out a bearish engulfing day on Friday. All of this took place at channel resistance, giving rise to the idea that the pair may be ready for the next leg lower.

Summary: Opportunity to watch for sell signals based on Friday’s bearish price action. Key support comes in at .8390, .8275, .8100 and .7950. Alternatively, a daily close above channel resistance would negate any bearish setup and likely prompt higher prices.

NZDCAD bearish engulfing day at channel resistance

Leave a Comment: