Forex Weekly Watch: May 30 – June 3, 2016

EUR/JPY

EUR/JPY 1-hour Forex Chart

EUR/JPY 1-hour Forex Chart

EUR/JPY might continue to trend lower, as the pair is moving inside a falling wedge pattern on its 1-hour time frame. Price is just testing the top of the wedge right now and a move lower might be due since stochastic is already in the overbought zone. An upside break, however, could lead to a move up to the PWH or top WATR while stronger bearish pressure could lead to a drop until the bottom WATR. The upcoming ECB decision this week could serve as a catalyst for a breakout so watch out for that.

  • WO: 122.75
  • Top WATR: 123.97
  • Bottom WATR: 121.54
  • PWH: 123.66
  • PWL: 122.22

GBP/JPY

GBP/JPY 1-hour Forex Chart

GBP/JPY 1-hour Forex Chart

Pound bulls just won’t give up! Guppy is now moving inside an ascending channel formation visible on its 1-hour chart and has just bounced off support. Price seems to be on track towards testing the top of the range near the top WATR or 164.00 handle, but stochastic is already indicating overbought conditions so another test of support might take place. This week’s PMI releases from the U.K. and additional Brexit-related updates could dictate the direction for this pair.

  • WO: 161.32
  • Top WATR: 163.70
  • Bottom WATR: 158.94
  • PWH: 162.52
  • PWL: 158.05

EUR/GBP

EUR/GBP Daily Forex Chart

EUR/GBP Daily Forex Chart

How low can EUR/GBP go? After breaking below the head and shoulders neckline the other week, the pair seems to be on track for a longer-term selloff. Zooming out to the longer-term time frames shows that the next area of interest is at the .7400 major psychological mark, which lines up with the 61.8% Fib. For this week, the pair might find near-term support at the bottom WATR or PWL around the 50% Fib level, but the top-tier catalysts could still lead to stronger moves.

  • WO: .7724
  • Top WATR: .7800
  • Bottom WATR: .7648
  • PWH: .7894
  • PWL: .7650

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