First, a few words about the forecast for the previous week:
- with regard to EUR/USD, the forecast we had given was fully implemented during the first half of the week. As graphical analysis had warned, the pair first rose up to 1.0900 resistance area, and then went down, losing 200 points quite quickly. After that, having performed this task, and looking back at what happened in the stock markets, the couple decided to return to the level of 1.0925, having gained the same 200 points back;
- concerning the future of GBP/USD, we had assumed that, having experienced some growth, the pair must reach a minimum of 1.4555 by mid-January. However, this happened a week earlier, and the pair appeared in this area on last Friday;
- the forecast of the behaviour of USD/JPY turned out to be correct only as far as the trend direction is concerned. Both indicators and graphical analysis talked about some advantages of «bears», but no one expected that it would be so strong, - instead of the expected 70÷100 points, the dollar has lost three times more - 300 points exactly;
- as for the direction of the trend, the forecast for USD/CHF turned out to be 100% true as well - the pair growth to a height of 1.0700 earlier in the week, and then its return to the 0.9850 support. However, developments in stock markets sharply increased volatility of this pair as well. As a result, it was able to reach a height of 1.0123, and then went down to the support at 0.9923.
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Forecast for the coming week:
Summarizing the views of several dozen analysts from leading banks and brokerage firms, as well as the forecasts based on different methods of technical and graphical analysis, we can say the following:
- with regard to EUR/USD, having returned from holidays, analysts predict a sideways trend for the pair in the range of 1.0750÷1.1000. Graphical analysis on H1 agrees with this forecast as well, predicting first a rebound from the upper border, then a drop, then again a return to the upper border of the channel. If the move to bigger time-frames, graphical analysis of D1 and 67% of W1 indicators continue to insist on the pair's drop at least to the zone1.0450÷1.0515, giving it 10 to 14 days for this;
- speaking about the future of GBP/USD, it becomes clear that all the indicators look straight down. However, graphical analysis on all time frames and most experts agree that the pair has reached its local bottom and will oscillate around the Pivot Point 1.4500 during the next week. The main support is at 1.4450, resistance - 1.4600;
- judging by the statements of analysts and readings of graphical analysis, the pair USD/JPY also reached its local minimum, and now it is waiting for a sideways trend in the range 117.20÷119.50. Pivot Point will be held at the level of 117.90, and according to the graphical analysis on H4, in the first half of the week the pair has to go above this line, and by the end of the week to drop to values of last Friday;
- and finally, the last pair of our review - USD/CHF. It seems that the scenario of the second half of December will repeat again for it. At the very least, analysts as well as indicators and graphical analysis on D1 agree with this. According to this forecast, the pair will fluctuate within a wide range from 0.9800 to 1.0100. As for the near future, according to graphical analysis on H4, it expects a rebound from 0.9920 support and leave to resistance 1.0015. Then again, the pair will go down and, having bounced off the said support, it will try to break through the resistance in an effort to reach a height of 1.0050.
Roman Butko, NordFX & Sergey Ershov
