Recapping the Majors
EUR/USD– The Euro once again met resistance at the 3400 level as it barely nipped it before falling right back down to around 3350. The Euro has been bouncing in between the 3300-3400 range for the past 7 days. It seems as though the market is still deciding whether or not to break or bounce off of this 3400 resistance level.
Result: The Euro stayed put right around 3360.
GBP/USD- The Sterling started this week off with a bang as it started to rally against the Dollar early in the trading day. The pair met little resistance on its way up until finally peaking at 9800. The pair had been consolidating for the past 7 days and finally broke the pattern today with the rally.
Result: The Sterling opened the week strong with a nice 100+ pip rally against the Dollar.
USD/CHF- The Swissy pretty much stayed put after the volatile movement it had on Friday. The pair had large spikes on Friday but still ended up closing around 2150. As you recall, the pair has been ranging between 2100-2200 for quite some time now and so far, the pair has not broken the pattern.
Result: The Swissy stayed very quiet and hovered right around 2150 for the entire trading day.
USD/JPY- Wednesday the Dollar fell hard against the Yen. Thursday the Dollar rallied strong against the Yen and on Friday the pair went both ways and ended up at a standstill right around 117.80. Today the pair opened up at around 117.50 and rallied to around 118.00 but is now trading back down around 117.80.
Result: The Dollar rose slightly but is still trading under 118.00.
Chart Analysis: What’s going to happen next?
Last Thursday I talked about the Euro heading back to 3400 followed by another drop and that is exactly what happened. The Euro has been ranging between 3300-3400 for a while now which leads me to believe that the market can’t decide whether or not to break or bounce off of the 3400 resistance level. Both 4hr and daily stochastics are trending up which leads me to believe that we may see the pair rise back up to 3400 and maybe even spike above it but unless there is a major fundamental catalyst I think we’ll see the 3400 resistance level hold strong.
Wow talk about pulling a complete 180! I talked about the Cable going down to 9500 but instead the pair shot up to 9800. The pair will face tough resistance anywhere around 9800-9900 because these are extreme highs for the Sterling. 4hr stochastics is in overbought territory and daily stochastics have crossed back up and is headed back into overbought territory. I think we may see the pair shoot back up to 9800 or perhaps even higher but I think we should see the pair cool off from there.
The Swissy continues to move up and down from 2100-2200. Currently its right in the middle at 2150. Both 4hr and daily stochastics are trending down which leads me to believe that if the pattern continues, we should see the Swissy fall to 2100 or at least close to it sometime in the near future.
Ooh this pair is teasing me right now. My trade idea from Thursday triggered and my target at 118.50 was almost hit as the pair rallied to around 118.40. However, the pair lost momentum and fell back down to around 117.50. Currently I am up about 20 pips as the pair is trading around 117.80 at the moment. I’m going to continue to hold on since I think we could still see the pair head back up to 118.50. Daily stochastics have crossed up which confirms my bullish bias but 4hr stochastics are currently trending down which means we may have to weather the storm a little bit. If you don’t know what I’m talking about, here is the trade idea I posted on Thursday:
Buy USD/JPY at 117.60; Stop Loss= 116.70; Target= 118.50