First, a few words about the forecast for the previous week:
- With regard to EUR/USD, our forecast has been implemented almost entirely. Judging by the opinion of experts and graphical analysis of H1, we predicted for this pair a sideways trend, a rebound from the upper border, then a drop, then again a return to the upper border of the channel, and that is what really happened;
- concerning the future of GBP/USD indicators turned out to be right in the combat of indicators and analysts, they had been strongly pointing to a further fall of the pair;
- Giving a forecast about the behavior of USD/JPY, the experts proceeded from the fact that the pair had reached its local minimum, and should go into a sideways trend. That is what happened. However, on Monday and Friday the pair made two attempts to break through support at 117.20. The first one failed, and it is too early to talk about the success of the second one;
- as for USD/CHF, on Monday the pair also tried to go down to the next level - the zone of 0.9800, breaking the support 0.9920, but failed, and, as predicted by graphical analysis, it went up - to the upper boundary of this corridor 1.0100. Having reached this value, in full agreement with the opinion of experts, the pair returned to the main level of the last few months - 1.0000, and completed the week there.
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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 made based on different methods of technical and graphical analysis, we can say the following:
- whereas, speaking about the future of EUR/USD, 75% of the indicators vote for the growth of the pair, the majority of experts are inclined to "bearish" sentiment. Supporting the latter, charting on D1 draws a downward continuation of the tunnel, and says that in the first half of the week the pair will go down to the lower border in the area of 1.0650, and then beat off to the upper border 1.0900. At the same time, if we "go" through this tunnel further, we can see that it ends at a minimum of last year - 1.0450, and the pair might achieve this value by the end of the current month;
- regarding GBP/USD, the situation of the previous week is repeated - both experts and graphic analysis cannot wait to see a rebound of the pair up at least to the level of 1.4370 (H1) for the greater time-frames rebound levels are more impressive - 1.4520 on H4 and 1.4700 on D1. However, 100% of indicators continue to insist on the continuation of the downtrend. Moreover, if you look at the chart W1, it is clear that there is still room for the pair to fall: it is at the minimum of May 2010 now, but there is still the minimum of January 2009 - 1.3500, which it may choose as the next target;
- USD/JPY. Judging by the statements of 65% analysts and graphical analysis on H4, next week the pair is facing a slight correction with the transition to the zone of 117.40 ÷ 118.00, and then descend to the support of 116.00. Indicators on H4 and D1 agree with this;
- and finally, the last pair of our review - USD/CHF. According to the forecast, which was given a week ago, the pair was supposed to fluctuate within a wide range from 0.9800 to 1.0100. This forecast has been confirmed this week as well. A complete discordance can be heard as far as the sequence of these fluctuations is concerned. Thus, indicators on H1 are in the neutral position, H4 support the "bears", and D1, on the contrary, have entered into an alliance with the "bulls". As for the graphical analysis on H1, one can see first growth to a height of 1.01125, and then return to the level of 1.0020. After that, according to the indications on H4, the pair will go down to the support 0.9870, and having rebounded, it will return to the highs of early January. If we talk about the graphic analysis on D1, it predicts a fairly fast growth of the pair to the height of 1.02500, after which the fall to the Pivot Point 1.0000 will follow.
Roman Butko, NordFX & Seregey Ershov
