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Here’s the market outlook for this week:: Content courtesy of Tallinex Limited https://www.tallinex.com
EURUSD
Dominant bias: BullishLast week’s upward move of 230 pips has resulted in a Bullish Confirmation Pattern on the 4-hour chart. The resistance line at 1.1450 has been tested and will be breached as price targets other resistance lines at 1.1500 and 1.1550. However, May will be challenging for bulls because EUR will be prone to weakness against other currencies. The exception is EURAUD, because AUD will also be weak against other currencies during May.
USDCHF
Dominant bias: Bearish
Price merely moved in the opposite direction to EURUSD - dropping 220 pips and later closing below the resistance level at 0.9600. There is now a bearish market outlook, and further decline is possible this week - potentially towards the support lines at 0.9550 and 0.9500. There cannot be a reversal of this bearish movement unless there is a serious weakening of EURUSD.
GBPUSD
Dominant bias: Bullish
There was a gradual rally last week that reached the distribution territory at 1.4650. Bulls fought desperately at the 1.4600 distribution territory, only to meet more strong opposition at the 1.4650 distribution territory. However, that opposition should be surmountable, owing to the bullish outlook on GBPUSD (and most other GBP pairs like GBPAUD and GBPNZD) for May. Price should therefore move up another 200 pips this week.
USDJPY
Dominant bias: Bearish
This pair went sideways from Monday to Wednesday then dropped 500 pips on Thursday to close below the supply level at 106.50. There has been a bearish signal for this market (and other JPY markets too) so this bearish movement should continue this week as price action is characterized by lower highs and lower lows. Short-term rallies can be taken as short-selling opportunities.
EURJPY
Dominant bias: Bearish
As mentioned last week, price first trudged upward between April 25 and 27 then plummeted. The drop was significant - overturning the recent bullish gains and causing a Bearish Confirmation Pattern to form. Price has broken the supply zones at 124.00, 123.00 and 122.00, and is now reaching out for the demand zones beneath them. The outlook on JPY pairs is bearish for May, so long trades make little sense until a strong bullish reversal appears in the market: something that may take place before the end of the month.
I’d like to conclude this forecast with the following quote:
“The goal of a successful trader is to make the best trades. Money is secondary.” - Dr Alexander Elder
Azeez Mustapha
Currency Analyst
Tallinex Limited
The Jaycees Building, Stoney Ground
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