Forex Weekly Watch: Feb. 29 – Mar. 4, 2016

EUR/JPY

EUR/JPY 1-hour Forex Chart

EUR/JPY 1-hour Forex Chart

Aha! Here’s the pullback I’ve been waiting for since last week! EUR/JPY is now testing the descending trend line resistance on its 1-hour forex chart, still deciding whether to make a bounce or a break. This area lines up with the 38.2% Fibonacci retracement level, which appears to be holding as a ceiling at the moment and might be strong enough to push price back to the previous lows around 122.50. A larger correction to the 61.8% Fib and area of interest around 126.00 could still be possible, but a move past this line in the sand could mark the start of a reversal.

  • WO: 124.45
  • Top WATR: 125.77
  • Bottom WATR: 123.13
  • PWH: 125.56
  • PWL: 122.47

GBP/JPY

GBP/JPY 1-hour Forex Chart

GBP/JPY 1-hour Forex Chart

In the mood for another pullback? GBP/JPY is also trading below a falling trend line visible on the 1-hour forex time frame. Price is currently testing this resistance area and might be ready to resume its downtrend soon, possibly even breaking below its PWL of 154.74 and making new lows. Stochastic is still heading south, which means that pound bears are on top of their game. A break past the trend line could lead to a higher pullback to the 61.8% Fib near the top WATR.

  • WO: 158.08
  • Top WATR: 160.52
  • Bottom WATR: 155.64
  • PWH: 161.55
  • PWL: 154.74

EUR/GBP

EUR/GBP 1-hour Forex Chart

EUR/GBP 1-hour Forex Chart

Now here’s a potential textbook break-and-retest play materializing on EUR/GBP’s 1-hour forex chart. The pair recently made a move past the resistance around .7800-.7850 but found resistance at .7930. Using the Fib tool on the latest rally shows that the retracement levels line up with this area of interest, spanning from the bottom WATR until the .7850 minor psychological mark. If any of these Fib levels keep losses in check, EUR/GBP might be able to climb past the PWH and top WATR. A break below the Fibs, on the other hand, could spur a selloff until the swing low of .7700.

  • WO: .7873
  • Top WATR: .7949
  • Bottom WATR: .7798
  • PWH: .7769
  • PWL: .7929

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