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Hi, and welcome to this Blueberry Markets video update with me, John Kibbler, Head Currency Analyst.
In this video, we’re going to go through the Forex Market Wrap. We’re going to take a look at the major currency pairs, how they performed, and what we could expect next week.
US Dollar Index
The US Dollar Index continued the sell-off. It’s bouncing back today, as expected. But, the market continued to move downside after breaking out of the low. Now, we’re looking for a pullback.
At the start of the week, we identified that when the price broke out of this range, we thought that we were going to get a pullback. Instead, the US Dollar weakness just continued for us.
It’s a Friday, so markets reverse slightly. I’m expecting the market to retrace higher next week. Whether we go back and retest the zone, we don’t know yet.
I’m looking for the market to close like this on the US Dollar Index next week. We could also get a bit of a retracement to the impulse move that we have at the moment. So, I wouldn’t be surprised if we saw US Dollar strength come back next week.
It’s going to be the same for EUR/USD.
We broke out of this range, and it continued to move to the upside. We continued up, and we retested the 1.13 area that we discussed in a previous video.
Key levels were hit on EUR, so seeing that daily bearish candlestick suggests that we are going to have a pullback on EUR/USD as well.
Again, we don’t know how deep the retracements will be. All we can do is mark up some key zones.
1.12 is a level of interest. The market reacted to this area before. So, if the market goes back down to 1.12, we could see a continuation of the US Dollar weakness up to previous structure highs on EUR/USD.
But, I am expecting a pullback in this market next week.
GBP/USD continued and broke through fresh highs after breaking out from 1.2650. That looks like the price will continue to the upside.
The next big level isn’t too far away, though. It’s around 1.28, where the market has recently found resistance and support.
So, we’re looking for the price to potentially bounce to the 1.28 level on the GB Pound. The GB Pound is facing a reversal that the strength from the weakness table is highlighting as well.
If you’re trading GBP/AUD and GBP/NZD, you’re going to be good.
We’re looking for a reversal here. GBP/CHF also looks good as the price breaks to the upside.
If we look at USD/CHF, we have a false breakout on the daily range. The USD/CHF wasn’t really on our radar to begin with.
But in this range, we were looking for the price to either bounce or break from it. We were looking for the trend to change cycle, but it didn’t. Instead, it gave us a false breakout and is now rallying back up.
So if the daily closes like this, I expect the Swiss Franc to sell-off and continue to push back up to these higher ranges. This could be the one to watch next week.
If that happens, then we could see Swiss Franc set off across the board and against stronger currencies such as the GB Pound.
Going into AUD/USD, the price hit the 0.7 level and rejected it. Are we going to see the selling pressure come back to the AU Dollar? And if so, where could it go?
The structure highs are sitting around the 0.660-70 area. I’m expecting to see the price to retest this zone.
Are we going to see the market pull back into the level where it found support and resistance in the past? We’ll find out next week.
So, I’m looking for AUD/USD to break down. We’re starting to see candlesticks close within the daily candlestick ranges. If this market closes like this, then I would expect a retracement to come from AUD/USD.
It might not go down to 0.67, but it may come up higher as well. 0.68 is another good level.
So, there are different areas to highlight if the market goes down and continues to break through. I’m expecting to see the 0.67 level getting hit next.
Kiwi looks similar. The market is stronger than the AU Dollar at the moment, and continues to push higher. It’s currently at the resistance zone.
It’s retesting this area, but we don’t know if the price will react to that point. Is it going to break, or is it going to bounce?
At the moment, the four-hour trend is to the upside. It’s quite a steep move, so I’m expecting a reversal after. We’ll just have to wait and see how the price reacts to this key resistance zone.
The USD/CAD was an interesting pair because the price looks to be slowing down with this candlestick range.
We’re looking to place a buy order. But, we’re going to place the stop-loss below the low, just in case we see a reversal today, and it still hasn’t followed through.
The Stock markets climbed, so the CA Dollar gained value. The market continues to sell off, but now, it has hit this area of support.
We could start to see a few buying opportunities come back – any kind of four-hour changes in cycle. I didn’t expect to see a pullback to recent swing lows on USD/CAD.
It’s shaping up for a US Dollar reversal and some strength to come back next week. It would probably be just short-term, but we’ll look at that in the Forex Market Outlook on Monday.
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