In this week’s Market Outlook, we take a look at the key charts ahead of the election with #EURUSD, #NZDUSD, #EURJPY and more!
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Hi, and welcome to this Blueberry Markets video update with me, John Kibbler, Head Currency Analyst.
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In this video, we’re going to take a look at the key charts of the week. I have the strength and weakness chart here as well. I’ll bring that on-screen to show you what I’m looking at this week.
The US Dollar is still the major one for me. We have the US Dollar here continuing to gain value from last week. I thought the numbers would be a little bit better. However, you can see across a couple of currency pairs that the US Dollar is gaining some value against them. I like the opportunities coming across this week.
EUR is the one that I like; shorts on EUR/USD. Again, last week, we tried to grab a short on it. It didn’t quite make it back to the area where I liked to get short. But, there’s a couple of levels this week that I’ll point out.
NZD/USD was also a nice chart to watch this week. We could go and look at that, and I’ll show you what I’m looking at there.
I quite like the idea of NZD/CAD, still. So, NZD/CAD was something we wanted the look at while CA Dollar was gaining strength. Kiwi was at the resistance area. So, the NZD/CAD downside looked good. That’s now trending on the four-hour timeframe very nicely. I quite like the idea of getting shorts on NZD/CAD, still.
Finally, we will take a look at EUR/JPY because we spoke about EUR/JPY earlier in the week. We liked the idea of it breaking to the downside. It has now followed through. The JP Yen is coming from a minus-six area, went to minus-four, and it remained at minus-four. However, a bit of a mixed bag last week for the JP Yen against the EUR, which is losing value, but it looks good for further downside.
Going into the charts: EUR/USD. What I’m looking at is the four-hour trend, and we can see that the price is trending to the downside. The market is making nice lower lows, and lower highs and the price recently broke out and found some new lows on Friday, which makes me think that we’re going to get a continuation to the downside this week. And the level that I’m watching for is 1.2120, and I’m watching this level because it’s the previous structure low and 1.2154. And 1.2154 is the point of control from last week. You can see a lot of action going on through here and a lot of action going on through there, making it the most traded level of last week. I’m identifying these two areas as potential areas for some further shorting opportunities.
The extreme side of that would be at 1.2218, and that is the previous structure highs. The way I look at the market at the moment, in terms of trend, would be more like this: the market makes a low in here, we make a lower low lower high, the price comes in, lower highs, and a continuation to the downside because this is almost like a false move. The markets are breaking to the downside. If the price does come back up into this level, there’s still opportunity to potentially get short on the back of that move here.
We are moving on to Kiwi. I like Kiwi on the downside. Mainly, the daily timeframe is now confirming what we’re talking about in terms of what we were looking at on this level, here, to act as slight support or the level we wanted to see broken. The prices have now broken below that level, and you can see that it was resistance, support, support recently and we’ve made this head and shoulders pattern.
The price is closing below that level, that suggests that we could see some further downside. I like the fact that the weekly rejected that level that we spoke about. It looks to me like we’re going to get that start to that weekly trend potentially forming here.
Going to the four-hour timeframe now, let’s check out that trend, and we can see the price making lower lows and lower highs. We had a couple of retests of this area here, and the price finally made it to the downside.
Again, a couple of levels to take into consideration. We have 7165; this is the market’s neckline area where we have seen some recent support and resistance, and we also have 7186. Suppose the price can get into either level and set up on a strategy basis. I’ll be looking to get short around these two levels. Again, the risk is up here, around 7230 or 7035. If the price breaks above there, the idea is invalid. But if we could still get a rejection here as well, we have three levels to consider this week.
EUR/JPY trended nicely in the end. We talked about getting short around this level, here, because the price had consolidated at that point. Nice breakdown, it then came and retested 126.50, broke to the downside again, and broke through this 126.25.
Now, 126.12 is a monthly point of control, and if I go into the monthly timeframe first or at least the daily timeframe, this 126.12 was used quite a lot over December and acted as support at the start of January where the price broke to the upside. It’s now collapsed underneath it, this area, here, could be used as a resistance level going to the downside, and it’s nice to see that this key level lines up with the monthly point of control. It is the area I was speaking about in January where the price retested that structure and rallied to the upside. Now, the price is trending down this level, here, which could become significant this week. So, 126.12 is the area I’m looking at for as a resistance point.
The weekly area that I liked is 126.50, simply because it was a nice area where the price recently found some resistance. One or two areas are again looking to get short this week on EUR/JPY.
Finally, moving into NZD/CAD. This was a level that wasn’t on the chart that I liked last week. The point of control was around this level. The price rejected it a couple of times and traded nicely to the downside. Looking for something similar again where we can potentially get the price continuing its move downwards. We’ve got this nice trend. Can the price come back into this 91.26 level? Or can it trade back towards this 91.74? That level, there, was one high area of value last week or volume this week. I like the idea of either getting short here or back up at this previous structure point.
Thanks for watching this video, and thanks for watching this Forex Market Outlook. I hope you have a great week, and I’ll speak to you soon.
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