Firstly, a few words about the forecast for the previous week:
- Regarding the behavior of EUR/USD, we had refrained from giving a precise prediction, laying out two possible scenarios instead: either the pair’s growth towards the resistance level in the 1.1450 zone, followed by a downwards rebound, or a simple fall. As a result both alternatives ended up occurring: the pair was falling at the start of the week, before rising to the resistance at 1.1450 and, after a rebound, collapsed to its starting point from last Monday.
- With regards to GBP/USD, the pair followed the prediction with an accuracy of 100% for the first half of the week: having knocked at the resistance in the 1.5480 area, the pair rolled down to its support at 1.5335, before launching upwards, as had been predicted. However, following the news from Europe this rebound was so powerful that the pair actually broke through the resistance at 1.5480÷1.5500, turning it into a support level and arriving in the area that it had been in for the whole of the second half of summer.
-As for USD/JPY, the pair continued its sideways trend which it has endured since the end of August, as had been presumed, and by so doing narrowed both its lower and upper oscillation boundaries by 40 points.
-USD/CHF, on the other hand, did not satisfy experts’ growth expectations, having spent the week in a sideways trajectory, just like its Japanese sibling. However, following the Fed’s announcements on Thursday, the pair started falling downwards before collecting itself and returning home on Friday.
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The forecast for the upcoming week:
Generalizing the opinions of dozens analysts from the world’s leading banks and brokerage firms, as well as forecasts that are based on the largest possible variety of technical and graphical analysis, the following can be said:
- On H4, the fortnightly ascending channel of EUR/USD can be easily observed, with the pair finishing at its lower boundary – 1.1300 last Friday. Rather strong support is located nearby at 1.1280. For this exact reason, practically all experts and indicators agree that the pair will be approaching the upper boundary of 1.1450 throughout the next few days. Opinions diverge after that point, however. 57% of indicators on D1 and graphical analysis on H1 suggest that the pair will continue its upwards movement towards the 1.1500÷1.1550 area. The remaining 43% of specialists, graphical analysis and H4 indicators insist that the pair will transition into a sideways trend with a Pivot Point at 1.1360.
- Practically everything that has been said above for EUR/USD can be recycled for use with GBP/USD. The pair is now located at the lower boundary of an ascending corridor, close to a strong support zone around 1.5500. The pair should rebound from that level towards the upper boundary at 1.5700. After that, the pair will either breach it and travel 100 more points up, or will transition into a sideways trend.
- As for the future of USD/CHF, most analysts and indicators agree that the pair will spend this week in the corridor 0.9550-0.9675 where it was in the end of August – beginning of September. And it only 18% analysts think that the pair will go one level up, to the zone of 0.9675-0.9775.
- For USD/JPY experts and indicators forecast a continuation of the sideways trend, which would be dominated by bearish tendencies. The Pivot Point will be at 119.80, the first support will be at 119,00 and the next support will be at 118.45. Resistance will be at 121.00 and 121.50.
Roman Butko, NordFX & Sergey Ershov
