My, my, my – what happened over the weekend!? It looks like the EURUSD has gapped up by almost 100 pips from last week’s closing price! With both a morning star doji and a breakout from a double bottom, this could signal the start of a new uptrend. My question is, will bulls continue to push price up to test former highs around 1.3800? Or will the pair dip and try to fill the gap just above 1.3500?
Almost the same could be seen on the GBPUSD daily chart, as it too broke out of a double bottom chart pattern. Notice how the pair was able to gap up over the weekend and opened above the neckline around the 1.5380-1.5400 area. Judging from how strong the break was, it looks like the bulls will continue to buy up the pair all the way to the 1.5800 area, the next major resistance level.
And it looks like the USD will even lose against the JPY! After topping out at 94.79, the USDJPY fell four days out of five last week, indicating that the bears have been in control. With stochastics pointing downwards and the pair trading within a rising wedge pattern, we could see the bears break 93.00 soon and take the pair down to 90.00. Then again, if we fail to see a candle close below 93.00, a retest of the previous week’s high is probable.