 Forex Weekly Chart Outlook Says Run for the Exits!
After whipsaw trading following a weaker US jobs report, the market has to pick up the pieces after a tough end to the week where it ended in a risk off mood led by the sell-off in stocks..
In the week ahead, the focus will be on equity markets to set the risk mood while the forex market will be keeping an eye out for which currencies, if any, act as safe havens. Traditionally, the dollar acts a a safe haven during times of market stress but this time around it is a tougher call given the focus on US rate cuts.
EURUSD DAILY CHART
Last week I said the EURUSD range was 1.10-1.12 with 1.11 setting the trading bias.
Well, that didn’t change after a whipsaw end to the week following the US jobs report
Looking at this daily chart, it would take a break of 1.0949 to fully negate the upside risk.
Highlight: ECB decision on Thurday
USDJPY WEEKLY CHART
Risk remains on the downside as long as it stays below 144.22 although price action suggests there may have been a hidden hand protecting 142.
Why 142 is important is that below it looms key levels at the recent 141.68 low and 140.22.
Downside stays at risk as long as it trades below 144.22.
USDJPY remains the most sensitive currency to the risk on or risk off mood, especially the latter.
GBPUSD DAILY CHART
1,32 is one if those pivotal levels that will dictate whether the market can regain power for another run higher or back off.
The failure to hold above it and retest the high suggests a lack of power but only a break of 1.3087 would suggest more to the downside. Above 1.3087 it is still in a consolidation mode.
Note how the straight line move up has left a void of key supports so in the absence, use retracement levels as potential supports should 1.3087 fail to hold.  See our Fibonacci Calculator
USDCAD DAILY CHART
USDCAD survived the BoC rate cut but the price action to end the week shows its sensitivity to the risk on/risk off mood (and fall in crude oil)..
With key resistance not until above 1,37, the 200 day mva (yellow line) is the first obstacle but price action is likely to be influenced as much by the risk mood than technicals.
AUDUSD DAILY CHART
Similar to the USDCAD, the AUDUSD, the price action to end the week underscores its sensitivity to the risk on/risk off mood (week ended in risk off).
Also, similar to USDCAD, watch the 100 (blue) and 200 Iyellow) mvas but price action is likely to be influenced as much by the risk mood than just technicals.
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