The VantagePoint Weekly Forex Outlook

Forex Weekly Outlook

The Forex Weekly Outlook is designed to help traders remain aware of Intermarket correlations of global market relationships. You can become more profitable if you know how to get ahead of the trends and understand that these relationships can potentially expand your portfolio. Utilizing the predictive indicators and Intermarket relationships in VantagePoint Intermarket Software can help traders find the right trades and the right times to enter and exit those trades. Let’s look at the charts for the U.S. Dollar and the major pairs

Forex and the U.S. Dollar

The U.S. Dollar Index is the backbone of forex trading. The bulk of the trades involves buying or selling the U.S. dollar. Understanding the movements of the individual market will greatly benefit forex traders as they will be able to better predict the movements of the pairs based on the IDX market movement.

Key levels and market movements:

The numbers coming out of the US are definitely supporting a rate hike down the road. This is fueling a dollar rally. But there is a high correlation between gold and the US Dollar. In order for the dollar to move higher, gold will need to move lower. But there is heavy support for gold right around the 1260 area. These levels need to be taken out for gold to move lower, and for the dollar to move higher.

What do the indicators say?

The VantagePoint predictive 18-day moving average is at 93.860 and the VantagePoint PRSI is at 74.4. The neural index is back at a “one” position indicating short-term strength.

Forex Weekly Outlook for Major Pairs

The major pairs are where most Forex traders trade the market. In the Forex Weekly Outlook we take a look at the most popular pairs analyzing price action, news events and/or risk off scenarios that could play a role in market movement, and a series of VantagePoint charts that best present information that can assist traders in determining where the market may move in the week ahead.

Euro/U.S. Dollar (EUR/USD)

Key Levels and market movement:

The EUR/USD pair is still getting downward pressure because of the move higher with the US Dollar. The pair has even broken through that trend line that started to form. If the pair continues to hold below 1.1757, the pair is expected to continue to move lower. However, looking at the bigger picture of a year, the pair has been predominantly bullish this year. So this move lower is likely corrective in nature.

What do the indicators say?

The predictive 18-day moving average is 1.1757 and the PRSI is at 22.4. The neural index is at a “zero” position indicating weakness over the next 48 hours.

U.S. Dollar/Swiss Franc (USD/CHF)

Key Levels and market movement:

The USD/CHF continues to advance on the US dollar strength and EUR weakness. It has broken through that upper trend line and the pair is likely to advance. Traders should take note that as the pair continues to move farther away from the VantagePoint predictive 18-day moving average, the more likely the pair will retrace to that level.

What do the indicators say?

The PRSI is at an 81.6 and the predictive 18-day moving average is at .9822. The neural index is at a “one” position indicating the potential for short-term strength.

British Pound/U.S. Dollar (GBP/USD)

Key Levels and market movement:

That tight wedge formation discussed in previous weeks is still very prevalent. The pair has tried to break above this area, but continues to fail. There is continued support right along the 1.3100 level but the indicators in VantagePoint remain bearish.

What do the indicators say?

The VantagePoint predictive 18-day moving average is at 1.3200 and the PRSI is at 41.6.

U.S. Dollar/Japanese Yen (USD/JPY)

Key Levels and market movement:

The USD/JPY continues to move towards the swing high back in early July. But there is significant order flow resistance just under the 115 level. This pair needs to break above this level in order for more advancement and right now the VantagePoint indicators are mixed. Traders should look for a clean break above the 115 level in order to start getting more aggressive with longs.

What do the indicators say?

The PRSI is at 76.6 and the predictive 18-day moving average is at 112.983.

The Commodities Currencies

U.S. Dollar/Canadian Dollar (USD/CAD)

Key Levels and market movement:

Just like the US Dollar, Gold is highly correlated with the USD/CAD pair. If gold breaks below those key levels, this will put upward pressure on this pair. However, the VantagePoint indicators are mixed and the pair continues to move farther away from the critical VantagePoint level, signaling a higher chance for a retracement.

What do the indicators say?

The VantagePoint predictive 18-day moving average is 1.2610 and the PRSI is 80.4

Australian Dollar/U.S. Dollar (AUD/USD) and New Zealand Dollar/U.S. Dollar (NZD/USD)

Key Levels and market movement:

For the AUD/USD pair, there is still considerable support at the .76 level. The VantagePoint indicators are pointing down as the pair continues to lose strength.

For the NZD/USD pair, this is almost identical to the AUD/USD pair. Traders need to be bearish as long as the pair remains below .7020.

What do the indicators say?

For the AUD/USD pair, the predictive 18-day moving average is .7776 and the PRSI is 17.0.

For the NZD/USD pair, the predictive 18-day moving average is .7020 and the PRSI is 13.2.