[FOREX TIP] AUDUSD Weekly Forex Forecast – 20th to 24th Feb 2017

AUDUSD Weekly Forex Forecast – 20th to 24th Feb 2017

The AUDUSD technical pattern has moved from consolidation into a very tight range zone. But small ranges are always followed by price expansion and the tighter the range the more aggressive the break will be. The stochastic indicator and the AUDUSD price have moved in the opposite directions over the past two weeks creating a massive bearish divergence that warns a reversal is the most probable outcome.

To the upside 0.7696 should act as resistance while the first major level of support comes in at 0.7600. A break below the support level will see a momentum acceleration to the downside and open the door for a much deeper correction.

We have a soft Australian economic calendar that doesn’t have any major risk event that can disrupt the volatility, except the speech held by the RBA Governor Lowe. On Thursday Governor Lowe is due to speak at the Australia-Canada Economic Leadership Forum, in Sydney and on Friday we have Governor Lowe is due to testify before the House of Representatives Standing Committee on Economics, in Sydney.

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[FOREX TIP] USDCAD Weekly Forex Forecast – 20th to 24th Feb 2017

USDCAD Weekly Forex Forecast – 20th to 24th Feb 2017

The USDCAD is having a hard time breaking below the big psychological number 1.3000 which indicates more ranging activity as long as we trade between 1.3030 support and 1.3212 resistance levels. Once any of these two levels are broken we can expect some trend developments, but until then the most probable scenario is for a rally and a retest of 1.3200 that should quickly fade and see USDCAD returning back inside its price range.

We can note a bullish divergence between the USDCAD price and the stochastic indicator which is why we favor more upside in the short-term. However, a daily break above 1.3212 will open up the door for a retest of the 1.3385 swing high. We have a low level of activity in terms of risk events that can disrupt the USDCAD volatility. Friday, however, traders need to pay attention to the Canadian CPI inflation figures which based on the market expectation are expected to jump higher from -0.2% to 0.3%. The jump in inflation expectation is due to the rise in price in the energy sector.

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USDCAD Weekly Forex Forecast – 20th to 24th Feb 2017 – Bullish

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[FOREX TIP] GBPUSD Weekly Forex Forecast – 20th to 24th Feb 2017

GBPUSD Weekly Forex Forecast – 20th to 24th Feb 2017

The GBPUSD weekly close below the big psychological number 1.2500 indicates more bearish pressure in the short to medium-term. However, a daily break and close above 1.2500 can signal a shift in the sentiment and can make the bearish case less likely to unfold. To the downside, the first level of support comes in at 1.2300 followed by 1.2200 which can produce a reaction to the upside. We can note on the stochastic indicator a build-up in bearish momentum which is one of the reasons why we favor more the downside as long as we trade above 1.2500.

The UK economic calendar doesn’t have much to offer us in terms of risk events. The only notable economic data are the second estimate of the UK GDP for the last quarter of 2016. The preliminary figures beat expectation as the UK economy grew 0.6% and based on the market consensus we should expect a flat reading. Wednesday we also have the FOMC Meeting Minutes which will provide in-depth insights into the latest FOMC meeting. This is crucial for the interest rate expectations as it will clear the view of whether or not a March interest rate hike is on the table.

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[FOREX TIP] USDCHF Weekly Forex Forecast – 20th to 24th Feb 2017

USDCHF Weekly Forex Forecast – 20th to 24th Feb 2017

Technical Outlook: USDCHF has beeen range bound within 1.0060 and 0.9934 with no directional bias being established. This indicates that the sideways range will sooner or later breakout to establish the trend. For the moment, it is evident that resistance at 1.0100 – 1.0060 has been firm enough to pin down prices, meaning that there is increasing likelihood of a decline to the downside. Watch for support at 0.9934 which could be tested in the near term. A break down below this support could mean further declines in USDCHF towards 0.9683. Alternately, to the upside, only a break out above 1.0100 will signal any further gains in store.

Fundamental Outlook: The Swiss franc turned stronger last week on a broad based risk aversion sentiment that hit the markets mid-week which eventually led to a flat close for USDCHF. The week ahead is quiet as far as the Swiss markets are concerned. Data points over the week include trade balance figures which is expected to show an increase of 3.03 billion, up from 2.72 billion. This came on increase of 3.8% exports while imports increased 4.1% or about 1.2% in real terms. The surplus of the trade balance is expected to rise in January as well. In the U.S., with the exception of the FOMC meeting minutes, it is a quiet week which could see most of the flows in USDCHF shape based on investors outlook.

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[FOREX TIP] USDJPY Weekly Forex Forecast – 20th to 24th Feb 2017

USDJPY Weekly Forex Forecast – 20th to 24th Feb 2017

Technical Outlook: USDJPY’s attempt to break out above 114.00 resistance failed mid-way as price quickly posted a reversal. We expect further declines to push USDJPY to test 112.50 support and could potentially see USDJPY consolidate within the support zone of 112.50 – 112.00 region. However, the falling trend line is likely to offer dynamic support which could keeep USDJPY range bound within 1114.00 and 112.50. In the near term, look for a bounce off 112.50 level for a retest back to 113.50. Expect to see further gains or declines only on a breakout above 114.00 resistance or 112.50 support..

Fundamental Outlook: A slow week from Japan, focus turns to the flash manufacturing PMI figures for February. Manufacturing PMI data being released by Markit this week is expected to show a moderation in the sector with the index forecast to fall to 52.1 from 52.7. Later in the week, the Japan all-industry activity is expected to show a 0.2% decline on a month over month basis. However, the major part of the week will see focus on how investor sentiment will shape out especially with the U.S. Federal Reserve releasing the FOMC meeting minutes during the week. With rising interest rates expectations alongside a mixed investor sentiment, the Japanese yen could see some volatility.

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USDJPY Weekly Forex Forecast – 20th to 24th Feb 2017 – Bullish

 

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[FOREX TIP] EURUSD Weekly Forex Forecast – 20th to 24th Feb 2017

EURUSD Weekly Forex Forecast – 20th to 24th Feb 2017

Technical Outlook: EURUSD attempted to rally off 1.0520 but the bounce was short-lived as prices quickly reversed back lower to a few pips above 1.0600 support. We expect to see further declines towards 1.0600, with th 4-hour Stochastics showing a hidden bearish divergence on the charts. Watch for the previous low established at 1.0520, which if breaks could trigger further downside in prices. To the upside, if support is formed at 1.0600, then long positions are recommended in EURUSD targeting 1.6980 and 1.0820 initially. The daily chart time frame has formed an inside bar and also points to a potential breakout in the near term.

Fundamental Outlook: Data from the Eurozone will see the release of flash manufacturing and services PMI over the week. Data for the most part is expected to show a continued upward trend in both the sectors which could reinforce expectations of stronger growth continuation in the first quarter in the region. Besides, the flash data, the final inflation figures from the Eurozone is expected to confirm that consumer prices rose 1.8% on the headline and 0.9% on the core. The data is unlikely to move the markets much, but a positive upside surprise, especially on core inflation could see some bullishness in the euro.

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EURUSD Weekly Forex Forecast – 20th to 24th Feb 2017

 

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