Weekly Trading Forecasts for Major Pairs (July 4 - 8, 2016)

3 July 2016, 20:50
1246536 Ernest G.

Here’s the market outlook for this week: Content courtesy of Tallinex Limited https://www.tallinex.com

Dominant bias: Bearish
Price moved up 150 pips last week - testing the resistance line at 1.1150 in the context of a downtrend. However, the outlook remains bearish for this week and, in order to turn bullish, price needs to climb at least 300 pips from here, otherwise the support lines at 1.1100, 1.1050 and 1.1000 will be tested this week. Those support lines were recently breached, and will be again as the bearish movement continues.

Dominant bias: Bullish
This was essentially a flat market before June 23, but was pushed upwards by the strong decline in EURUSD. A faint bullish attempt was made last week, but met opposition from bears who checked further progress and forced price to bend downwards (on the 4-hour chart). The recent bullish signal is in a precarious situation, and further bearish correction could cancel it - forcing price back into the neutral territory from before June 23. This week, bulls need to maintain resolve to avoid victory by bears, but a large roadblock looms: CHF will soon gain serious strength this month, and could result in some selling pressure on this and other CHF pairs (except CHFJPY).

Dominant bias: Bearish
This market was virtually flat last week, in the context of a downtrend. There are Bearish Confirmation Patterns on 4-hour, weekly, and monthly charts - all of which signal serious weakness for Cable. There is also bearish expectation on GBP pairs - like over the last two weeks. Though bulls may attempt to push price up by a few hundred pips (at most), bears will end up winners. GBP pairs will experience strong movements this month.

Dominant bias: Bearish
Price went flat last week, in the context of a downtrend. It will be difficult for bulls to push this pair upwards by much, as there are adamant supply levels above, and because the outlook on JPY pairs is bearish for this month, so JPY pairs are expected to assume major bearish movements this week (which could last until early October). This pair should trend downwards by at least 200 pips by early next week.

Dominant bias: Bearish
Though the major bias is bearish, price went up 250 pips last week. There are supply zones at 115.50 and 116.50 that might be tested this week, but bears will still continue to dominate… putting more emphasis on the major bias, which is also visible on higher timeframes. Just like other JPY pairs, this pair could drop further over the next few months, though that does not rule out the possibility of noteworthy bullish efforts.

I’d like to conclude this forecast with the following quote:

About fifteen years ago, I moved to the U.S. and worked with several CTAs. This was the point in my career that I made the decision to eliminate all human emotion from my trading. I became a purely systematic trader. For me, emotion and subjectivity are the enemies. Good traders follow systems. Systems have rules.” - Francisco London (Source: Collective2.com)

Azeez Mustapha
Currency Analyst
Tallinex Limited
The Jaycees Building, Stoney Ground
PO Box 362, Kingstown, VC0100
St Vincent and the Grenadines

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