pair nosedived by 130 pips on Monday, resulting in an existing Bearish Confirmation
Pattern in the market. The support line at 1.1000 is
currently under siege. It risks brakeout to the downside. Should that happen, the next target would be the support line at
1.0950 (which was tested last week). It could be difficult for the price to
close below that support line.
USD/CHF: It would
normally be expected that the USD/CHF pair shall go in direction opposite to EUR/USD (hence the rally on Monday). However, the resistance level at 0.9500
has been reached and it is the level where bulls found it impossible to
push the price further northwards last week and the week before the last week.
If bulls find that resistance level difficult to be broken this week, a bearish correction is likely to take place.
GBP/USD: This currency trading instrument continues to
be volatile in the context of a downtrend. The downtrend cannot be over until
the distribution territory at 1.5650 is breached to the upside. Until then, any
rallies in the market could be short-selling opportunities.
USD/JPY: The USD/JPY pair rallied by100 pips on Monday, testing the supply level at 123.50. There is now a ‘buy' signal in the market and the price may eventually test the supply level at 124.00. For the bullish signal to continue to be valid the price would also need to test the supply level at 125.00 this week; otherwise the risk of a bearish correction would be high.
EUR/JPY: Would the price go upwards or
downwards? Time would tell. It would be great to stay away
from the cross until a clear directional bias is confirmed.
The material has been provided by InstaForex Company – www.instaforex.com