In this week’s Week Ahead Analysis we take a look at the key charts of the week with #EURUSD, #GBPUSD, #EURJPY and more!
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Week Ahead Analysis
Headline news risk will still remain this week as the market continues to feel the effects of the war between Ukraine and Russia. Over the weekend we have had news of civilians being trapped within cities despite talks of civilian corridors being agreed by both sides. Not only this but news of more nuclear reactors being shelled will add further risk to the market.
In planned news this week we see key data from the ECB and RBA as well as Inflationary data from the US. The ECB is expected to leave rates unchanged at 0.00% as they look to manage the risk of the effects of the Ukraine and Russia war. They have stated recently that they want to be able to be flexible with monetary policy decisions. The RBA could be more positive this week as the Australian Dollar has continued to climb despite the risk off sentiment in the market. The US CPi figures this week could continue to put pressure on the Federal Reserve to hike rates more aggressively despite Chairman Jerome Powell saying a 50bps jump is unlikely. The inflation rate rising again could force the Fed to be more aggressive.
The price of EURUSD has plummeted recently due to the ongoing war between Ukraine and Russia. The news of Europes largest Nucluer Plant which is based in Ukraine being bombed and being on fire saw the Euro fall aggressively. This momentum could continue going into this week especially if the ECB sees the risks of this war being too high to make any changes. Looking at the 4hr trend we can see that if the price was to rally and retest an area of resistance and form bearish price action we could look for short trading opportunities.
The GBP is another currency that has been hit hard by the war. The strength meter this week shows the GBP is still the weakest currency and that it is likely to continue in the near term. The GBPUSD has also formed a new low on the 4hr time frame which could offer short opportunities if the price forms bearish price action at the key resistance zone.
The Euro is weakening and the JPY is strengthening which will offer trend trading opportunities. The price of the EURJPY has broken out of a key weekly trading range. If this bearish sentiment remains we can look for further short opportunities at key supply zones.
The German stock market DAX40 moved into new lows last week which looks set to continue. The new low on the 4hr time frame can offer short trading opportunities at the highlighted zone of interest. This supply zone could see the price form bearish price action and offer an opportunity if the stock market continues to remain bearish.
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