Hey everyone! Welcome to this week's forex forecast for the week ending January 22nd, 2021. I'm TraderBart with A1 Trading, and this week I'll be looking at GBPUSD, CADJPY, GBPAUD & XAUUSD.
Looking at GU on the Daily timeframe, price has been channelling along for almost a year now, forming higher highs and higher lows. We have recently seen price break through the previous higher high's resistance at 1.348, and we're currently seeing some choppy movements in the past couple weeks, with price staying below the intraday resistance at 1.37. If price continues to hold above the previous high's resistance (now new support) at 1.348, then it's a good position to go long, or once we see price break above the intraday resistance at 1.37 then with successive price action confirmations of a continued bullish move, could also be an excellent position to go long as price heads towards the channel's top.
Here price is forming an ascending triangle pattern with resistance at around 82.00. We can see two different ascending trend lines, as price seems to be holding both well, so if trend line 1 gets broken, I'm still expecting trend line 2 to continue holding the pattern together. We could enter this pattern two ways, the first would be on the ascending trend line when price approaches it, and then signs of rejections are visible. The second way would be to wait for price to break above the resistance in this pattern, wait for price to retest, then look out for price action confirmations of a continued rejection then go long.
Looking at GA on the H4 timeframe, we can see price forming another descending triangle pattern right after the previous successful descending triangle, with support at 1.743. Price is currently around the descending trend line, which could be a great position to go short on this pair, once we see clear price action confirmations of a rejection to this level. On the other hand, we could also take another short once price breaks through the support, wait for price to retest then look out for price action confirmations of a continued rejection and go short for at least a 1:3 R:R.
Price has been holding this overall bullish flag pattern since June 2020, price was on its way to break above the channel's top and complete the flag pattern however we saw price fail and return inside the channel. Price is currently consolidating between two intraday levels at 1860 and 1820. Right now I would suggest staying on the sidelines until there are clear confirmations of a move above or below these levels. Once we see price break through either level, look out for a retest then continued price action confirmations of a rejection before taking a position in the desired direction. If price does break below, a move back down to the channel's bottom looks likely.
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