Market analysis on EURUSD, GBPUSD, and EURJPY: 3rd October -7th October

EURUSD: 3rd October -7th October 

eurusdFigure: EURUSD daily chart

The medium-term uptrend is at risk since the medium term secondary bearish trend line is providing significant amount out resistance near the 1.1260 level. In the last week, a bearish engulfing pattern is formed just near the bearish trend line resistance. Those who are bearish on the EURUSD pair can sell this pair setting a tight stop loss just above the 1.13000 level mark. But investors are overly cautious about selling this pair since the mighty dollar is pretty weak at this moment. The recent FOMC meeting minute has clearly declared that there is no possibility of interest rate hike before the month of December 2016.However, risk reward ratio favors the short entry at this position. If the bearish trend line manages to limit the upward momentum of this pair then we can see a sharp fall in this pair towards the 1.09594 level. The temporary support at 1.09594 level might provide some initial support to EURUSD pair but if the Non-farm employment data comes out negative then we will again see a retest of the 1.13000 resistance level. A clear break of that level will bring a strong rally in the upward direction towards the 1.1500 level. Those who are willing to buy this pair should wait patiently for the bullish breakout of the 1, 13000 resistance level. A trader should wait for minor retracement of the pair towards the broken trend line resistance which will turn into support. The long entry should be initiated in this pair only with bullish price action confirmation signal at broken trend line support zone.

The bearish momentum of the pair is currently absent in this pair. Investors are showing very negligible interest in selling EURO. However, if the pair manages to breach the strong support level at 1.09594 then we will see a strong downward rally towards the 1.0800 level. A valid break of that level will confirm the strong selling pressure in this pair which will ultimately lead this pair towards the critical support level of 1.0500 level. A daily closing below that level will confirm the end of bullish momentum in this pair. Considering all the parameters and US economic condition it’s better to remain bullish in the EURUSD pair.

GBPUSD Forecast: 3rd October -7th October

Figure: GBPUSD daily chart

The Great Britain pound is fighting back to recover its loss after the Brexit news. The first initial correction after the sharp fall has been limited by the critical resistance level at 1.34387 level. The form that levels the pair again falls sharply breaking the previous low, hitting 1.27000 support level. Currently, price is respecting the bullish trend line and trying to recover its loss. If the pair manages to breach the trend line support then we will again see a sharp fall in the GBPUSD pair which will ultimately challenge the strong support of 1.2700 level. Last week the price formed a nice bullish morning star pattern right at the rising trend line but the bullish momentum is not satisfactory. Long entry can be taken in this pair with a tight stop loss just below the 1.2870 level. The first initial bullish target for this pair would be 1.30922 level. A valid break of that level will bring a strong upward rally in this pair towards the 1.34387 level.

The 1.34387 is going to play a significant role in the next move in the GBPUSD pair. A valid break above that level will bring a strong upward rally in the pair for more than 500 pips. If the pair manages to test the 1.3800 level than 60% of the loss of Brexit will be recover by the Great Britain pound. The current weakness of the US dollar is suggesting that the pair has completed its fall near the 1.27000 level. Considering all the parameters and weakness of the US economy the overall bias remains bullish for the GBPUSD pair for this upcoming week.

EURJPY Forecast: 3rd October -7th October 

eurjpyFigure: EURJPY daily chart

The long term bearish trend in the EURJPY pair is still intact and currently forming a triangle like structure.

The sharp fall from the 128.22 level is still pretty strong and most likely to test 103.00 level before it moves in the north again. Currently, price is heading towards the minor bearish trend line resistance .Professional price action traders are waiting for the long term bearish trend line resistance at 116.00 level to sell this pair. On the contrary in the presence of strong selling pressure, aggressive traders can short this pair near the minor bearish trend line resistance at 114.00 level with price action confirmation signal. The first initial bearish target for this pair is 112.08 level. A clear decisive break below that level will bring strong downward rally in this pair towards the 109.20 mark.

The overall scenario for the EURJPY remains bearish until the market breach the 118.48 level. A valid break of that level will bring temporary buying pressure in the market targeting the critical resistance level at 121.30 level. But buying this pair at this level will be an immature act since the market is not ready to move in the upwards direction. We are bearish on this pair until the market breaks the strong resistance level at 118.48 level. It is better to look for selling opportunity near the critical resistance level with tight stop with an initial target of 112.08 level. But before the market moves aggressively we are expecting ranging move in the triangle chart pattern which is most likely breached in the bearish direction.

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