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Here’s the market outlook for the week:
EURUSD
Dominant bias: Bullish
There was a sudden and fast bullish breakout on EURUSD, which made it go upwards 450 pips, testing the resistance line at 1.0950. The price consolidated after that, till price closed last week. The bullish breakout has abruptly overturned the recent bearish trend in the market, but a crucial question remains… Was this a false breakout? A false breakout could be as significant as you might think, but it would remain false in case it cannot be sustained. For this bullish breakout not to become a false one, we should see further bullish movement (whether fast or gradual); otherwise, another leg of southward movement would start. It has already been said that the outlook on USD is bright for December, while EUR is expected to be weak.
USDCHF
Dominant bias: Bearish
There was a surprise pullback on this pair last Thursday, as it went below several resistance levels, plus the great psychological level at 1.0000. Price nosedived by 400 pips last week, reinforcing the gradual bearish movement that started at the beginning of last week. Now the USDCHF is facing challenges from two fronts: The recent strengthening of EUR and the expected rally in CHF. Yes, CHF is expected to start gaining stamina by the end of this week, and that can last until Christmas Eve (please watch CHF pairs). This means that bulls will certainly not find it easy to push up USDCHF price.
GBPUSD
Dominant bias: Bearish
On Thursday, December 3, 2015, GBPUSD also went upward 250 pips in a positive correlation attempt with EURUSD. The distribution territory at 1.5150 was tested after price rose from the accumulation territory at 1.4900. Nevertheless, the bearish outlook on GBP pairs remains unchanged for the month of December. It can be seen that the major bias on most GBP pairs have been bearish, so, the recent upward bounces should be opportunities to go short at better prices.
USDJPY
Dominant bias: Neutral
What happened on this currency trading instrument last week was short-term upward and downward swings. The swings have not succeeded in overturning the neutral bias on the market. A movement of at least, 200 pips to the upside or to the downside is required before price could move out of this neutral zone. A movement to the upside is the most likely because the US dollar would be making some bullish effort, and because the Yen might suffer further loss of strength. The market condition is now currently great for scalpers and intraday traders.
EURJPY
Dominant bias: Bullish
As it was mentioned in the past, one of those things that could bring about a vivid rally on this cross is a vivid rally in the Euro itself. That was exactly what happened last week. From the demand zone at 130.00, price shot skywards, reaching the supply zone at 134.50 (a movement of 450 pips). Price has moved sideways since then, but further upward movement is possible because JPY pairs might move upwards this month, in certain cases.
This forecast is concluded with the quote below:
“Although strategy is important, it is not as critical as knowledge and the discipline to apply and adhere to your rules. A trader who really knows the strengths and weaknesses of his or her strategy can do significantly better than someone who knows only a little about a superior strategy. Of course, the ideal situation would be to know a lot about a great strategy. That should be your ultimate goal.” – Mark Minervini
Source: www.tallinex.com
What Super Traders Don’t Want You To Know: http://www.advfnbooks.com/books/supertraders/index.html
