Weekly Trends: 3/18/12 – 3/23/12

Forex weekly trends – an overview of the trends in the forex market for the past week with likely developments for the next week.

 
EUR/USD: Still a bullish scenario for the next couple days but correction is likely.

Toward the end of the last week the pair appreciated nicely due to so-called “risk appetite.”

The pair looks overbought a bit above 1.3150 so the chances are that we will see a very modest dip prior to the price resuming its way up. It will likely try to teach 1.3250 in the next couple days. At this point it looks like it will be overbought somewhat above 1.3250 so another dip will likely to follow. The same scenario likely to play over and over again during this week – an appreciation followed by a dip. The weekly picture is bullish but no clear uptrend can be seen at this time. Similarly to the last week, unstable volatility is very likely.

Range between 1.3150 and 1.3300 is likely for this week – oversold condition below 1.3150 and overbought above 1.3300.

Common indicators should be fairly accurate in pointing to the direction of the price on the hourly or shorter charts.

GBP/USD: No much upward momentum.
 
The price appreciation of the pair toward the end of the last week is likely short-lived. No strong upward momentum can be seen at this time. The pair likely will start to look oversold below 1.5750 and somewhat overbought above 1.5900. Still a narrow range between 1.5750 and 1.5900 is likely for the week. The longer outlook has changed since the past week and is neutral – slightly bullish at this time.
 

USD/CHF: Downward momentum is likely to slow down.
 
150-pip drop of the last week is likely to slow down during this week. The pair looks oversold below 0.9075 and is unlikely to fall very far from these level. For the next several days the price is likely to stay within 0.9175 – 0.9075 range and unlikely to deviate very far from these levels. The longer outlook has changed and is neutral – slightly bearish.
 

USD/CAD: Likely back to the parity.
 
As expected the price went below the parity during the last week. Volatility was falling, so some mild breakout can be close. The pair will look mildly oversold below 0.9850 so it is likely will try to return back to the parity during this week. The price likely will stay within 0.9850 – 1.0000 range during this week. The longer outlook is still bearish.

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