FOREX MARKET WRAP: 15th Jan
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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 go through the Forex Market Wrap. We’re going to identify what happened this week.
Mainly, the US Dollar gained strength, and this was something we pointed out in the Forex Market Outlook. We wanted to look for the US Dollar to start gaining strength again because when we looked at the strength and weakness chart from the beginning of the week, we identified many different things. One thing was the US Dollar in that minus-six or minus-seven position gaining a little bit of value from last week, and we were expecting that to continue due to the recent weekly bullish charts from the US Dollar Index.
Not only that, we had the idea to look for further EUR shorts, which came off quite nicely.
The GB Pound, however, did a little bit of a U-turn. It dropped quite aggressively last week. Then this week, it climbed a lot further than we anticipated and then it started to turn.
But, the one thing that we like to look off was CA Dollar and CA Dollar towards the start of the week and the middle of the week was looking quite strong.
We also have JP Yen in a position where we have that minus-six. We were potentially looking for a bit of a continuation this week because the JP Yen was looking a little bit on the weak side of that reversal on Kiwi.
Let’s touch on what happened this week. We had a nice bearish week on EUR/USD; we can see the lovely bearish candlestick, expecting that to continue. We do have these previous structure points, over here, on the weekly timeframe. I’m hoping for this weekly retracement phase to continue, promoting a further downtrend on the four-hour timeframe. We can see here that the market is making clear nice lower lows. The market consolidated here, it has broken through since, which is nice to see and expect that to continue as we move through this month.
NZD/USD as well, again, a nice weekly bearish reaction from the area that we spoke. I’m looking for some further downside here. Also, I’m expecting the market to maybe, come into this 6-780 area or 6800 area where these previous structures are. I’m looking for that retracement to continue.
Very similarly as well, we were looking for the daily timeframe to breakdown here, and we can see on this level that we spoke about that it is finally being taken out, and we are getting a nice bearish close. If we do get a continuation of that bearishness, maybe into these previous structure lows, I’d expect a retest and a continuation at that point. I’ll be watching that very, very closely next week.
The GB Pound, as I said unfortunately for us, we were looking for a bit of downside earlier in the week, and the price had a really strong bullish week. That was due to the Bank of England’s comments saying that they’re not going to push into negative interest rates. That gave the GB Pound a bit of a boost. However, being back at these highs is promoting some sellers to re-enter the market, which could continue as the US Dollar strength continues into the rest of the month. The GB Pound is also looking a little bit bearish.
EUR/JPY was something we looked at on the four-hour timeframe. We liked this area here. We spoke about the market opportunity to breakout and retest this level, come down into the 122.26, look for the pullback and potentially, a continuation. That’s followed through nicely. The real nice trend, through here, will show next week that EUR is very vulnerable and we should be looking for some potential EUR shorts to continue.
The US Dollar has gained some significant value. We should see some really strong numbers from the strength and weakness chart going into next week. The US Dollar continuation should be where we focus on our attention, and I’ll speak to you soon.
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