Forex Weekly Watch: July 13 – 17, 2015

EUR/JPY

EUR/JPY  1 Hour Forex Chart

EUR/JPY 1 Hour Forex Chart

And once again, another downside gap to open the week for EUR/JPY, and just like that, another gap fill right off the bat. And based on the past couple of weeks where we saw a gap fill and return back to the downside bias, it’s good odds we’ll see something similar, especially with the catalyst of the European leaders put even more demands on Greece this weekend.

With the pair already up around 80 pips from the week open (and closing in on last week’s close price), it’s nearing the top of the average weekly range where we could see sellers jump in here. Also, this is a 50% Fib pullback after the consolidation break from around 140.00 down to just below 134.00, another reason to possibly draw in sellers. It might be a great time to nibble for a short position, all the way up to the PWH and top WATR where sellers could be lurking around.

  • WO: 135.76
  • Top WATR: 137.45
  • Bottom WATR: 134.07
  • PWH: 137.28
  • PWL: 133.31

GBP/JPY

GBP/JPY  1 Hour Forex Chart

GBP/JPY 1 Hour Forex Chart

A super volatile week for Guppy last week with the pair on a roller coaster ride: first a drop from 192.00 to 185.00, and back up again to close the week just above 190.00 (also the 50% Fib area).  The question now is whether or not this is a simply a “deadcat bounce” before a return to the trend lower, or is it the beginning of a return to the longer-term trend higher?

For now, I’m leaning on a downside bias because of the uncertainty in the Greek debt story potentially weighing on risk sentiment.  Plus, the stochastic indicator on both the one-hour and four-hour are showing potentially overbought conditions.

  • WO: 189.90
  • Top WATR: 191.75
  • Bottom WATR: 188.06
  • PWH: 191.66
  • PWL: 185.01

EUR/GBP

EUR/GBP  1 Hour Forex Chart

EUR/GBP 1 Hour Forex Chart

The market made a nice run up last week but stalled just under the 61% Fibonacci level of the recent swing lower from around .7400 to just under .7000.  So, it looks like the sellers are back in control, especially after that small double top formation around the .7200 area.

On the other side of the coin, this could be a new move higher after potentially finding a bottom around the major psychological level (.7000), but I’d wait for a break of both the PWH and the top WATR level before getting my short-term bias aggressive to the long side.

  • WO: .7165
  • Top WATR: .7243
  • Bottom WATR: .7088
  • PWH: .7224
  • PWL: .7055

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