First, a few words about the forecast for the previous week:
- most analysts predicted that EUR/USD would drop, and only 19% of them mentioned a continuing upward trend. Experience has shown that the majority opinion isn’t always right – on Monday, the pair started to rise sharply, broke through resistance at 1.1050 and settled down at July’s high of 1.1210;
- the situation with GBP/USD was similar. The forecast closest to reality was given only by graphical analysis – contrary to the analysts, it predicted a sideways trend with support at 1.5460 and a drive to break through resistance at 1.5540. This eventually happened, and the resistance level turned into support;
- as expected, USD/JPY attempted to reach June’s high right away but only managed to conquer a 125.25 height. Then, in full accordance with the indications of graphical analysis, the pair tumbled down and entered a sideways trend with support around 124.15;
- overall, the forecast for USD/CHF can be counted as fulfilled – a sideways trend with a 0.9840 Pivot Point, resistance at 0.9900 and support at 0.9800. The pair moved within this range for the first half of the week, then dropped to the second support around 0.9710 and continued its sideways movement.
Forecast for the coming week. Generalizing the opinions of 35 analysts from world leading banks and broker companies as well as forecasts based on a large variety of technical and graphical analysis, the following can be suggested:
- regarding EUR/USD, 23% of the analysts support a continuation of the upward trend with the target of 1.1280, which is echoed by 56% of the indicators. But 23% of the analysts believe that the pair should descend while 46% of them indicate a sideways trend with a Pivot Point at 1.1110. At the same time, the indicators and graphical analysis point to a possible fall to support at 1.1035 early in the week. The next support will be around 1.0960;
- most analysts predict GBP/USD to fall to 1.5550. With this, the indicators and graphical analysis suggest that the pair should first reach 1.5690. The inclined line of support for such rise is clearly visible on the H1 and H4 charts. Graphical analysis on D1 indicates that within the next two weeks the pair will make a few attempts to break support at 1.5550 and, if successful, it will fall to 1.5200. After that, there will be a rebound to 1.5650;
- there’s basically unanimity regarding USD/JPY – sideways movement in a 123.75-125.30 corridor with a Pivot Point at 124.60. At the same time, graphical analysis on D1 indicates that one of the pair’s attempts to reach a 126.00 height may be successful. This should happen at the very end of August;
- the USD/CHF pair is very likely to continue its upward trend which started in the last decade of June. This ascending corridor is best visible on H4. The pair is currently near its lower boundary of 0.9710, off which it’s expected to bounce up towards 0.9900. After that, USD/CHF may enter a sideways trend with support around 0.9500, as was the case in March-April of this year.
Roman Butko, NordFXPublication source