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EURUSD turned to a strong bearish direction and it will try the very strong support of 1.1110. We believe that each time that EURUSD will approach this support level it will have strong bullish reactions but if it breaks it for good then maybe we’ll see it under 1.10, maybe close to 1.08. We must be very careful this week due to the very critical and important elections in Europe. We prefer short positions with a short-term horizon.
Another strong bearish week passed by. Euro elections and Nigel Farage party’s lead at the polls may lead GBP even lower but we must be very careful because GBPUSD is in extremely oversold levels and a bullish reaction is very possible. Volatility keeps on increasing and next support for the instrument is the area of 1.2470. Also, this week is full of news for the British economy, including Mr Carney’s speech on Tuesday and the release of UK CPI on Wednesday.
USDJPY had a bullish reaction during last week. Weak JPY condition verified and if the instrument protects the critical price of 110, we can see it close to 112 again. Good news for Japanese GDP early this Monday was not enough to strengthen JPY and this fact leads us to the conclusion that the bullish direction will dominate again, if trade wars do not turn very ugly.
EURJPY was in the middle of two very weak currencies last week: EUR and JPY. That is why almost every day the close price was very close to the open price. If this situation changes and a direction occur, we favour the short positions because of the general last weeks’ bearish trend.
A very strong bullish week passed by. EURGBP is not yet at hard overbought levels and the bullish direction is very possible to remain. We successfully predicted the taking of are 0.8675 and our next target 0.8820 still remains. Of course, GBP particularities due to Brexit and Euro elections must make us very careful.
USDCHF approached the area of 1:1 as we predicted and it had a weak bullish reaction. We believe that this reaction cannot change the direction to lower levels and maybe the price will try again the 1:1 level.
AUDUSD opened with a big gap, above last Friday’s closing price and till now it seems that there will be a strong bullish day. The trend is definitely bearish but the Australian elections last Saturday and the domination of the liberal party gives extra fuel to AUD and at least short-term it seems that it stopped the free fall of the currency. Governor Lowe speech in Brisbane on Tuesday may give extra strength to the instrument.
A total reverse took place last week for SP500 after last Monday which was very bearish. Friday was bearish too but the closing of the week gives the motivation to the traders for taking week’s profit. We believe that increased volatility will dominate this week with many ups & downs. We would prefer very short term opportunistic plays , without holding any positions overnight. Pay special attention to FOMC meeting minutes on Wednesday.
DAX30 followed the pattern that most of the markets did. Bearish Monday, strong bullish direction the next 3 days and taking profit on Friday. Bulls are possible for the Index with targets 12,320 points and 12,440 points. Euro elections create a fragile environment though. We’d prefer a small exposure with long positions for the current week.
No clear trend for FTSE100 last week reflects the fluid situation in Great Britain. Simply we stay out of the market at least until the Euro elections.
Japan225 Index reverted, following the international trend. The reaction is not very strong though and this makes us sceptical if we will follow it. We’d prefer short-term opportunistic long positions with low take profit.
Gold reacted exactly as we had predicted: A strong bearish reaction when the price reached the area of $1,300. We’re definitely sellers but we should keep in mind the strong double bottom resistance of $1,266. If it breaks it, price like $1,243 is possible
We successfully predicted the bullish movement of US Oil last week after a squeeze pattern. Price didn’t reach the price of $64.40 as we estimated (highest price was $63,80) but maybe it will succeed to do it this week , after news about OPEC’s oil production cuts.