First, a review of last week’s forecast:
- the forecast for EUR/USD suggested that the battle line for the bulls and the bears would be drawn at 1.1400. However, the fact that they were actually equal in force was a surprise. As a result, neither of them could gain the upper hand and the week started and ended at the same level of 1.1400;
- the forecast that GBP/USD will be moving towards last February’s lows is starting to pan out. Last Wednesday, the pair sharply reached 1.4000 but, as expected, it quickly returned to the sideways channel in which it has been moving for the last three weeks;
- the predictions for USD/JPY turned out incorrect. The pair reached the 110.70 support very fast but then, spurred by economic news from Japan, easily broke through it and went further down, finishing the week around 108.00;
- the USD/CHF pair demonstrated a sluggish sideways trend, making minor fluctuations around a 0.9570 pivot point.
Forecast for Upcoming Week
Summarizing the opinions of several dozen analysts from leading banks and broker companies and forecasts based on different methods of technical and graphical analysis, the following can be said:
- the W1 chart for EUR/USD clearly shows an ascending channel that started to form at the beginning of last December. Now the pair is basically at its top boundary. According to graphical analysis on H4 and D1, after rebounding from it, the pair should go down to the central line of 1.1135 and then return to 1.1500. The experts still hold onto the pivot point of 1.1400, indicating a sideways channel with quite a narrow range of 1.1320-1.1500;
- the forecast for GBP/USD remains unchanged – moving towards last February’s lows. This is supported by 65% of the experts, 100% of the indicators and graphical analysis on D1. The remaining experts believe that the pair will continue to fluctuate in March’s range of 1.4050-1.4450;
- it is clear that all indicators point down for USD/JPY. Two-thirds of the analysts and graphical analysis on H4 and D1 agree and reckon that the pair should reach the bottom at 105.50. Graphical analysis warns that a short-term surge up to resistance at 111.00 is possible before that. The longer-term forecast remains in force – USD/JPY should return to 114.70-117.00 in late April - early May;
- about 80% of the experts and graphical analysis on H4 continue to wait for USD/CHF to bounce upward. The next target is to return to around 0.9800. Support is at 0.9500.
Roman Butko, NordFX