USDJPY & EURUSD Forecast for week of Jan 8
A descending pennant for USDJPY and an ascending pennant and channel for EURUSD pointing at upcoming downwards trend for USDJPY and upwards trend for EURUSD, if not this Monday then within a few days from now.
Friday's buying power for USDJPY was already visibly breaking up. Regularly, a group of Cheap Charlies was buying when the price was low and subsequently driving the price back up. This price behaviour marks the current insecure state of the pair. EURUSD correlates negative with USDJPY due to having USD in reverse notation.
If Cheap Charlies give up on USDJPY, the price will fall hard. But if they keep coming back they may drive the price up again to next resistance at 113.4. I think that to anyones surprise this will happen and if enough bullish sentiment survived it will step in and help.
At the same time USD sentiment is changing and institutions may choose to move direction, then suddenly between two cheap charlie buying spurs the price might fall so hard that Cheap Charlies capitulate and depending on the balance between selling power and remaining buying orders the price may snowball down quite a way. To be continued...
Friday's buying power for USDJPY was already visibly breaking up. Regularly, a group of Cheap Charlies was buying when the price was low and subsequently driving the price back up. This price behaviour marks the current insecure state of the pair. EURUSD correlates negative with USDJPY due to having USD in reverse notation.
If Cheap Charlies give up on USDJPY, the price will fall hard. But if they keep coming back they may drive the price up again to next resistance at 113.4. I think that to anyones surprise this will happen and if enough bullish sentiment survived it will step in and help.
At the same time USD sentiment is changing and institutions may choose to move direction, then suddenly between two cheap charlie buying spurs the price might fall so hard that Cheap Charlies capitulate and depending on the balance between selling power and remaining buying orders the price may snowball down quite a way. To be continued...
Trade closed manually:
Directions as expected, with the USDJPY falling more aggressive. Perhaps at start of the since November anticipated drop to 100?
