In this week’s Market Outlook we take a look at the #GBPUSD, #EURUSD, #AUDUSD and more!
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Hi, and welcome to this Blueberry Markets video update with me, John Kibbler, Head Currency Analyst.
In this video, we will go through the Forex Market Outlook and highlight some key areas of interest in the markets this week.
US Dollar Index
So, looking at the US Dollar Index first, we can see that the price has approached this key zone, down here, retested, and rejected. If we look around that 96.80-96.70 zone, the market has come back down into these lows, which formed at the end of December and rejected again.
We could see an upside to the US Dollar this week according to the weekly timeframe.
Daily and Four-hour Timeframe
If we go down into the daily timeframe, we’re seeing slight rejection moves there; we expect a reversal to this down move that we saw.
I’m expecting the price to at least pull back into these key lows here, where we broke out of recently. Anything against that 98.60 – 98.80 area could be where the US Dollar is heading to continue that move down.
But at the moment, the price is looking good for some potential US Dollar buys. You can see that the four-hour trends are changing, and we could look for a little bit further upside.
Going on to EUR/USD, we can see that the price is at that key area of resistance. So, around 1.1360; it was that previous weekly high, since then, the markets rejected this.
Again, it looks like we could be seeing US Dollar strength this week, and we could see the price of EUR/USD drop slightly.
Going into that daily timeframe, we could see that the price had a false breakout of the previous high, so it’s almost like a double top pattern form here.
If we can still get some lower lows on the daily timeframe, we could see the price continue to fall back into some key areas of interest.
We’ve got 1.12 or 1.11-50 areas where the market could find support, or down into 1.1 where we broke out of that range. But, it looks to me that we could see a downside in EUR/USD.
Going into the four-hour timeframe, we can see that trend starting to push lower. If the price comes and retests these lows or back up at this zone, here, and starts to reject, we could see some short opportunities back down into these key levels.
Going into GBP/USD, all these major currency charts are starting to show a little bit of US Dollar strength potentially coming back into the markets.
We can see that the price has rejected that 1.2750 area, which is these previous weekly lows here. So, we also have a false break out in this weekly high, which is quite interesting to see.
We could see a downside again – coming into the GB Pound – with the US Dollar strength and prices possibly retesting at least these previous swing lows here.
Again, we’re going to monitor that four-hour trend. You can see that we’ve started to form lower lows and lowers highs. If the market rallies, we could see a retest of this zone because the market has retested this area on several occasions.
We may get another rally up before a move to the downside. But the four-hour trend has changed, showing us that there could be a short-term trend reversal forming here.
One of our favourite charts this week is AUD/USD. We’ve been looking for that AU Dollar weakness to come into the markets, and we can see that we’ve had a nice rejection of that 0.7 level.
We were watching GBP/AUD last week, so we’re going to take a look at that in a moment. But, both charts are looking pretty good for that Aussie weakness.
You can see 0.7; the last time it hit that level and rejected it, we had a massive fall in the markets. We were also in an overbought condition and had a bearish rejection of the key level.
Are we going to start seeing the market fall to the downside?
If we go to that four-hour timeframe, I’ve already marked up an area of interest; the market has formed a new low here. If we start seeing a bit bearish price action around this area, we could be looking for some short opportunities on AUD/USD.
Let’s take a look at GBP/AUD. GBP/AUD was our chart from last week, which did well for us.
Looking at that weekly timeframe will be key, and we’ve been talking about the fact that when the market isn’t on this weekly timeframe, it goes into an oversold condition like it did in July 2019. We seem to get a reaction when we start seeing a bullish price action.
Now we’ve started to see that here. Price is in that oversold condition, so it makes it an excellent market to look for that reversal. It’s also nice to see that it’s back at this key zone here, where the market has been in the past and rejected multiple times.
So, it’s nice to see some upside in this market again. The four-hour trend has changed, but it’s a very shallow uptrend.
I started seeing some considerable higher highs forming before we got involved with GBP/AUD, and it’s looking pretty good at the moment. We may get a double-bottom on the daily timeframe before seeing a move to the upside if the GB Pound is a little bit weak.
From a strength and weakness point of view, the GB Pound was the only real gainer last week. So, that’s quite interesting to see, and this is at a major swing level at the moment.
So, we’re looking for some potential upside because of that weekly timeframe.
Keep an eye on these currencies this week. I hope you enjoyed this video update. If you did, please like and subscribe to the YouTube channel for more, and I’ll catch you later in the week. Cheers!
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