Forex Weekly Watch: May 12 – 16, 2014

EUR/JPY

EUR/JPY 1 Hour Chart

EUR/JPY 1 Hour Chart

Finally–a breakout!  EUR/JPY broke through the support just above the 141.00 area after bearish euro commentary from ECB President Draghi last Thursday. The question is whether the new shift in sentiment is enough to create a momentum move lower, or is this a spike that will be faded this week? If it does pull back higher, I am watching the top WATR level for a possible short play on the euro.

  • WO: 140.16
  • Top WATR: 141.18
  • Bottom WATR: 139.15
  • PWH: 142.37
  • PWL: 139.89

GBP/JPY

GBP/JPY 1 Hour Chart

GBP/JPY 1 Hour Chart

It was another week where we saw the bears hold 173.00 once again!  And after a lower-than-previous read on U.K. manufacturing production data, it was a trip lower for Guppy until the PWL held at the end of the week.  For now, it still looks like a rangebound market but there is major U.K. data to spark big volatility for the pair.  Unless we get crazy surprise data, I’m still watching 173.00 as a top with possible resistance at the moving averages, and the bottom WATR levels looks interesting enough for a long play if retested and holds.

  • WO: 171.64
  • Top WATR: 172.94
  • Bottom WATR: 170.35
  • PWH: 173.00
  • PWL: 171.22

EUR/GBP

EUR/GBP 1 Hour Chart

EUR/GBP 1 Hour Chart

I’ve been mentioning for a while that EUR/GBP is a solid downtrending market, especially thanks to Draghi’s comments last week.  It’s tough whether or not to say that it’s a good time to initiate new short positions at these levels ahead of a busy calendar for the British Pound on Wednesday, but a pull back higher to the Fibonacci levels and top WATR is something to watch out for.

  • WO: .8166
  • Top WATR: .8209
  • Bottom WATR: .8124
  • PWH: .8249
  • PWL: .8161

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