Hey everyone! Welcome to this week's forex forecast for the week ending October 29th, 2021. I'm TraderBart with A1 Trading, and this week I'll be looking at USDCHF, GBPUSD, GBPJPY & XAUUSD.
Price broke out of the rising wedge pattern a couple of days ago, and price is already making its way to the downside to complete the chart pattern. Our first level of potential support is at 0.91, where we have seen in the past price has been struggling to break through; once we reach this level, look out for a break and retest before continuing the downwards ride on this pair.
Price is currently near the top of this descending channel, and we're now waiting on a precise touch and rejection to continue the trend and head lower. For now, there aren't any other specific levels where we could see consolidation, but unless we see lots of bears selling early, it's possible financial institutions could manipulate price towards 1.40 to stop out early sellers.
Last week we saw price break through 156.0, the previous high in the long-term ascending channel, and we're now seeing price retrace and retest this key horizontal level. What we see next could decide where price will go next, whether we'll see price fall below it could suggest further bearishness, whereas if we see price instantly reject this, it's likely we could see further bullishness, and price could head towards the top of this channel much quicker.
Gold continued to consolidate slightly between 1765 and 1800, and we saw price reach highs of around 1812 last week, but sellers quickly rejected this. For now, we're waiting on some significant catalysts to push price in a certain direction, as we just see back and forth moves for the time being.
Check out my previous G/U deep dive from mid-July here to see how we have progressed...
Looking at G/U's long term view, we can see the key horizontal level 1.43 which has been a major support back in 2011 and now major resistance from 2018 onwards. We did see price approach this zone in July/August and it's looking like we could see another move back towards the support in the long-term range-bound market to 1.21.
Following the break of the ascending channel, we're seeing another range-bound market in the medium-term between 1.36 and 1.39. The order block on the chart above is formed from the Daily timeframe.
Price did break the range, breaking past support at 1.36 and finding new lows at around 1.34. Currently, we can see price has now retraced the move and is already possibly finding resistance at the old bullish order block, now new breaker block. I personally believe though that this breaker block will fail, as it's at the same level as retailers support, who are now looking for confirmations of a new resistance. Just above we can see the new H8 bearish order block, where I believe it's likely we could see price reverse there.
As expected, 67% of G/U traders are waiting for price to reverse now, as price is now showing rejection to the resistance level. We're seeing more than double the amount of lots in volume, meaning financial institutions could make a lot more money stopping out the early bears.
Over the next couple of weeks, we've not actually got a lot of major GBP news, however...
We've got many major USD news coming out. This means that the price of G/U over the next couple of weeks will be more dependant on what happens to the USD, rather than GBP. A stronger Dollar will cause the price of G/U to decrease in price and a weak dollar will cause price to increase.
The rising price of G/U is caused by the easing of the fuel crisis in the UK after the government announced that armed forces will begin delivering petrol across the country. Adding to this, UK Prime Minister Boris Johnson said that we have reliable supply chains for Christmas. We also have a more hawkish turn by the Bank of England last week, indicating that they're heading towards policy tightening next year. An upward revision of the UK Services PMI for September was finalised at 55.4 against the 54.6 flash estimate, further strength for the Pound.
USD strength is rising as the Fed is expected to begin tapering its bond purchases as soon as November. Markets have started pricing the possibility of an interest rate hike in 2022. The USD will play a key role in influencing the pair amid absent news events from the UK. The price of G/U will mostly depend on what's currently going on in America as there's way more events coming out from there.
Hey everyone! Welcome to this week's forex forecast for the week ending October 1st, 2021. I'm TraderBart with A1 Trading, and this week I'll be looking at USDJPY, GBPUSD, GBPNZD & XAUUSD.
Price closed off for the week just above the resistance at 110.6 in this range bound market. Look out for how price reacts to this level, whether we see further bullish momentum continue pushing price higher, or if we see price retrace it's move and reject off the resistance, or if we see price fall back below the resistance and once again confirm the level as continued resistance as price heads back lower again, filling the gaps it's left behind.
We saw price reverse off the daily order block at 1.361 and is showing signs of a retracement to that move. Look out for how price reacts to the same order block, and if it will act once again as an area to go long off. If we see price push below this will turn this zone into a breaker block, an area to go short off.
Price continuing to consolidate in the middle of this range between 1.92-1.97. Look out for a clear break outside the short-term key levels acting as support and resistance which are 1.935 and 1.955. If price breaks above 1.955 it's likely we'll see further movements towards the breaker block at 1.97 whereas if we see price break below 1.935 it's likely we'll see price push towards 1.92.
Price is currently sitting inside the bullish order block and we're now waiting for a catalyst to push price outside the OB. If we see price continue going lower and break below the zone, this zone will become a breaker block, an area to go short from. Currently, in the short-term, we are seeing a descending channel form in the past couple of weeks, and hence unless price forms a new trend, a breaker block situation will be likely.
Let's look into the Bank of England's Monetary Policy Summary which took place on Thursday the 23rd of September, 2021.
The minutes of the MPC meeting revealed that discussions about inflation showed that might not be as transitory as expected. Further, it highlighted the uncertainty around the labour market regarding wages inflationary pressures due to labour shortage.
The Pound rose after the latest Bank of England (BoE) rate decision. The central bank left interest rates unchanged at a record low of 0.10%. The bank will continue with its asset purchase plan to support the economy costing £875B. The bank is also revised the country's growth forecast for the year to 2.1%, down from 2.9%. However, there's still a broad understanding that the BoE cannot solve the ongoing challenges facing the UK right now, an example would be controlling the spread of the Delta variant, ongoing supply shortages or the issue of inadequate workers.
The Committee voted by a majority of 7-2 for the BoE to continue with its existing programme of UK government bond purchases, financed by the issuance of central bank reserves, maintaining the target for the stock of these government bond purchases at £875 billion and so the total target stock of asset purchases at £895 billion. The two dissenters were Dave Ramsden and Michael Saunders, who voted for an early end of the program by decreasing purchases with a target of £840B.
Alongside this, the BoE noted that some developments have meant that the case for tightening has strengthened, which in turn has prompted a shift in money markets pricing in a 15bps rate hike for March 2022 vs Previous May 2022. That said, the March meeting is not a quarterly meeting like February or May, making it unlikely that a hike will take place in March.
G/U broke above 1.37 to 1.375 in response to a slightly more hawkish than expected statement, nearing the middle of the range between 1.36-1.39. We saw price bounce from the bullish order block at 1.361, the same support level that price has been bouncing off over the past month. It's likely we could see price retrace and collect final orders before continuing its bullish move towards resistance at 1.39.
Hey everyone! Welcome to this week's forex forecast for the week ending September 24th, 2021. I'm TraderBart with A1 Trading, and this week I'll be looking at USDJPY, EURUSD, GBPJPY & XAUUSD.
Price has been consolidating between 109-111 over the past couple of months, and we recently saw price bounce off the range's support back to the middle of the consolidation zone. Look out for a clear break above or below this structure to catch the new trend, following subsequent retests and rejections.
Huge moves rejecting the channel's top last week on E/U as price breaks below 1.18 and is now nearing the major key horizontal level 1.17. This level has been seen as major support over the past year or so, so look out for how price reacts to this level once we see price clearly enter. It's likely we could see the trend continue and price reaches the channel's bottom, before potentially retracing and making a move back towards 1.18.
Looking at the long-term trend on G/J price has recently touched and rejected off the previous high in this range at 156.0 and is now potentially making its move towards the downside. Currently, we have an ascending channel where price is actually at the bottom, and we're now waiting on clear confirmations whether price will break or respect this channel. If we see price break outside the channel, we'll likely see price continue the long-term trend and head towards the downside.
Price is once again back at the bullish order block at 1740, where financial institutions will push price towards before a reversal to take out traders who went long early, most likely at 1765. If we see price break below this zone, this area will become a breaker block, an area to go short off following subsequent retests and rejections.
Hey everyone! Welcome to this week's forex forecast for the week ending September 10th, 2021. I'm TraderBart with A1 Trading, and this week I'll be looking at EURUSD, GBPUSD, GBPNZD & XAUUSD.
Price has closed off for the week in the bearish order block just underneath 1.19, and we're now waiting on further moves to take place, to establish whether price will either respect this zone and reverse or continue breaking higher from the descending channel it has just broken out of. Most retailers by this point have been stopped out who went short at the channel's top and are likely going to go long now; however financial institutions usually reverse once more and head back towards the original position.
Price is back once again at this 1.388 key horizontal level which has been seen as clear support and resistance over the past couple of weeks. I made a deep dive on this pair as price was forming the descending triangle, and now that price completed that pattern move, price is now once again back at this level and just under its resistance. If price manages to break higher, we should wait for a confirmation of a retest before going long.
Over the past couple of months, price has been consolidating around this breaker block between 1.96 - 1.98 and we're finally beginning to see a break out of this zone. Price is currently heading towards the previous resistance and new support level from the ascending triangle at 1.92, and liquidity is likely pulling price towards this level. There is an order below where price will likely head to swell to stop out retailers who will go long early before potentially reversing.
Price has closed off for the week just below the resistance in this consolidation zone I've been pointing out between 1800-1835. We're now waiting on clear confirmations whether price will either respect of break this level and if we see a break of this trend. If price closes above 1835, we'll likely see price head higher towards the liquidity void ant around 1890. If price does in fact respect this level and go below, we'll likely see further consolidation on this pair.
Hey everyone! Welcome to this week's forex forecast for the week ending September 3rd, 2021. I'm TraderBart with A1 Trading, and this week I'll be looking at NZDCHF, GBPJPY, GBPNZD & XAUUSD.
Price is now sitting at the descending channel's top and traders are likely waiting on confirmation of either a rejection for a reversal towards the bottom, or price to break out, retest and continue heading higher. There is mixed retail sentiment at the moment, with 57% traders short currently, it's likely we could see price head higher to stop out traders early.
Price is currently consolidating near the channel's bottom and traders are now waiting on confirmations where price could be heading next. A close below the bottom could signify price possibly heading lower, and if price continues to stay inside the channel it's likely we could see price head towards the top in the long run.
Price is looking like it's going to exit the bullish breaker block and possibly head back down towards the key horizontal level around 1.92. If price does make a clear close outside the block, then this could likely happen. If price continues to stay inside, we could potentially see price make the next high again, and going long from this zone wouldn't be a bad idea.
Price is currently back inside the same zone we saw consolidation back in July between 1800 and 1835. A clear break above this level would suggest price is heading higher and if price does close below 1800, we could see price head back inside the channel again.
Hey everyone! Welcome to this week's forex forecast for the week ending August 20th, 2021. I'm TraderBart with A1 Trading, and this week I'll be looking at EURUSD, GBPNZD, EURAUD & XAUUSD.
A bearish flag pattern has formed on E/U after a descending channel has formed following an impulsive selloff in mid-June. Price has recently hit the channel's bottom and is now more than halfway heading towards the channel's top. We have a bearish order block at 1.187, where we could likely see a reversal towards the bottom from this zone. Look out for price action confirmations once price does reach this zone, look out for rejections before going short.
Price has been consolidating around and within this bullish breaker block zone for months now, and no significant move has yet to be made. Price did form a medium-term ascending channel where it's currently at the bottom, and I'm now waiting on price action confirmations of a rejection and a move potentially to the upside. If price breaks this formation and goes lower, it's likely we could see a new trend form, or price may go to retest previous horizontal levels such as 1.92 or potentially collect orders from OB's lower.
Price has recently broken out of the short-term ascending channel and is potentially forming a new descending channel if price fails to go higher than 1.61, forming the new lower high. Price has been moving pretty slowly in this market, and no breakthroughs have happened. 1.585 is a pivotal level to watch how price reacts; a break lower suggests we could retest 1.568, whereas if price holds this level as support, price is likely to stay above, and long positions could be a good idea.
Gold made a huge move in the past week, dropping more than 5% and then retracing the entire move plus more by Friday. Price has closed off for the week just above the channel's top, and in-between two horizontal levels, I've had my eyes on 1765 and 1795. Look out how price reacts to this current level to decide whether to go long or short. If price stays above the channel's top, we could likely see price head higher towards and above 1795, whereas if price comes back inside the channel, it's likely we could see some consolidation in the zone at 1740.
Hey everyone! Welcome to this week's forex forecast for the week ending August 13th, 2021. I'm TraderBart with A1 Trading, and this week I'll be looking at GBPUSD, USDJPY, NZDCHF & XAUUSD.
Price is currently consolidating around this 1.387 zone which was seen as resistance in mid-July and now as new support in early August. If price continues to hold, we'll likely see price head towards the trendline once more before we eventually see a break. However, a break below this zone suggests continued downside movement, and an entry following a retest with continued bearish confirmations would be ideal. Remember, we did recently see a break of the long-term ascending channel, and hence we could be forming a new long-term descending channel.
Following the better-than-expected NFP news on Friday, we're seeing price potentially break out of this medium-term descending channel which was recently formed following the break of the long-term ascending channel. If price continues to stay above the channel's top, look out for a clear break, retest then enter with clear price action confirmations of a continued bullish move.
Similarly to U/J, price is at the top of this descending channel in the long-term bullish flag pattern. If price rejects this level and reverses towards the downside, a move to previous lows at 0.63 is expected, potentially 0.62 if we see further bearish confirmations. However, if we see price break out of this channel, we could likely begin to see price complete the flag pattern and head to new highs. An entry following a retest with continued bullish confirmations would be ideal at the channel's top.
Following Friday's NFP event, where we saw a huge improvement in US jobs, price did in fact fall 2.2%. Price has again gone underneath the long-term channel's top and is hovering around a key horizontal level at 1765. If price uses this level as support, we could see price reach lows at the bullish order block at around 1740; however, if price breaks this zone, we could see it tumble towards the psychological 1700 level. We could likely see further downwards pressure as Fed tapering bets grow following this strong NFP report.
|BOE Monetary Policy Report||Aug 5|
|Monetary Policy Summary||Aug 5|
|MPC Member Broadbent Speaks||Aug 6|
In the Bank of England's monetary policy report this Thursday, analysts expect policymakers to remain less hawkish as concrete dates for rate hikes are still not decided. Broadbent's stance on inflation is the same as in the United States: inflation is transitory and will not last as the economy continues to recover. He also said that the current rise in inflation is coming from the higher oil prices that were expected to keep rising going into 2022.
Pound is preferred in risk-on pairs and not preferred in risk-off pairs. Analysts say the market is pricing in the rate hikes already even though there are no set dates yet.
Brexit problems have also contributed to the supply of goods and labor shortages in the UK. With the expectation of not raising interest rates, investors are moving away from the pound and to safer currencies like the yen or the franc.
I am mostly bullish on the pound this week, but it depends on the pairs. GBP looks weaker against pairs that are more risk-off like USD, JPY and CHF. So I might be looking at the short side of these pairs. However, against CAD, AUD and EUR, I would be looking to be long on the pound.
EURGBP on support right now and looks like it wants to bounce back. If so, the pair could retest the falling trend line for resistance. If price falls under current support, it could drop all the way down to a double bottom around .85045 on the 4H chart.
GBPCAD looks like it's breaking out of a wedge on the 4H timeframe, and a continued run could take the pair up to a top around 1.74949 or even higher at 1.7560.
GBPJPY could be bouncing off support here on the 4H chart, but behavior has been relatively weak in terms of price action in the last couple months. A long term falling trend line seems to be keeping price from breaking up while lower highs and lows are forming.
GBPAUD looks strong against the Aussie buck amid their militarized lockdown in Sydney. The pair continues to find support on a rising trend line on the 4H chart. There is also support around 1.87569 should price fall.