EURUSD:
The pair’s inability to hold above the 1.1060 level on the weekly chart suggests that sellers remain in control. And although last week did form a bearish pin bar, its development within a sideways market makes it an unfavorable pattern to trade in my opinion.
That said, I continue to watch for selling opportunities while below the former channel support that extends from the December 2015 low. Only a close back above this level would negate the bearish bias.
Looking lower, the first level of support comes in near the Brexit low at 1.0940. A close below that would expose the March 10th ECB low at 1.0820.
GBPUSD:
GBPUSD managed to reclaim some of the post-Brexit losses last week. However, the rally ended on a sour note as Friday’s session gave back 140 of the 195 pips gained on Thursday.
The late-week selloff could be a sign of things to come in the week ahead. Then again, the post-Brexit volatility and uncertainty that has been swirling for weeks now have made it difficult to get a read on the pair with any degree of confidence.
For this reason alone, I’ll continue to avoid trading GBPUSD as I feel there are better, less volatile opportunities available.
For those who insist on trading the British pound against the US dollar, key resistance can be found at the 1.3500 handle while support comes in at 1.30.
NZDUSD:
Similar to AUDUSD, the NZDUSD broke a significant level going into the weekend. The channel support that extends from the May low was tested previously on two separate occasions before the 4-hour break you see below.
I mentioned this pattern on Thursday as one to watch. What was particularly interesting was how the pair had tested support several times yet failed to challenge the upper boundary of the channel since the pre-Brexit highs on June 24th.
When a market begins to lean against support or resistance in this fashion, it’s often an early warning sign that a breakout is imminent. Although Friday’s price action stayed true to this idea, it’ll be important to see follow through in the week ahead to help confirm that buyers have indeed capitulated.
I’m short from 0.7180 and will watch to see how the pair reacts at 0.7080 if tested. Below that, the next level of support comes in at the June lows at 0.6986. A break below that could trigger a much larger decline toward 0.6900 and possibly the May low at 0.6675.
As for event risk, the NZD isn’t wasting any time getting started with the Q2 CPI reading on tap today at 6:45 pm EST.
Twitter page: https://goo.gl/PCNfER
Thank you JB.
After carving out a 150 pip range last week, EURUSD closed just 20 pips below the opening price. However, despite the lack
of direction, the pressure remains weighted to the downside following
the Brexit-inspired break of channel support on June 24th.
What’s interesting about last week’s price action is that the pair
respected the 1.1060 handle on a weekly closing basis. Friday’s selloff
put the pair back below this level, which was broken one week prior on
July 8th.The pair’s inability to hold above the 1.1060 level on the weekly chart suggests that sellers remain in control. And although last week did form a bearish pin bar, its development within a sideways market makes it an unfavorable pattern to trade in my opinion.
That said, I continue to watch for selling opportunities while below the former channel support that extends from the December 2015 low. Only a close back above this level would negate the bearish bias.
Looking lower, the first level of support comes in near the Brexit low at 1.0940. A close below that would expose the March 10th ECB low at 1.0820.
GBPUSD:
GBPUSD managed to reclaim some of the post-Brexit losses last week. However, the rally ended on a sour note as Friday’s session gave back 140 of the 195 pips gained on Thursday.
The late-week selloff could be a sign of things to come in the week ahead. Then again, the post-Brexit volatility and uncertainty that has been swirling for weeks now have made it difficult to get a read on the pair with any degree of confidence.
For this reason alone, I’ll continue to avoid trading GBPUSD as I feel there are better, less volatile opportunities available.
For those who insist on trading the British pound against the US dollar, key resistance can be found at the 1.3500 handle while support comes in at 1.30.
NZDUSD:
Similar to AUDUSD, the NZDUSD broke a significant level going into the weekend. The channel support that extends from the May low was tested previously on two separate occasions before the 4-hour break you see below.
I mentioned this pattern on Thursday as one to watch. What was particularly interesting was how the pair had tested support several times yet failed to challenge the upper boundary of the channel since the pre-Brexit highs on June 24th.
When a market begins to lean against support or resistance in this fashion, it’s often an early warning sign that a breakout is imminent. Although Friday’s price action stayed true to this idea, it’ll be important to see follow through in the week ahead to help confirm that buyers have indeed capitulated.
I’m short from 0.7180 and will watch to see how the pair reacts at 0.7080 if tested. Below that, the next level of support comes in at the June lows at 0.6986. A break below that could trigger a much larger decline toward 0.6900 and possibly the May low at 0.6675.
As for event risk, the NZD isn’t wasting any time getting started with the Q2 CPI reading on tap today at 6:45 pm EST.
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Thank you JB.
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