November 11, 2017
First, a review of last week’s forecast:
- Just this summer, strategists of many large international banks had designated the 2015 and 2016 highs in the zone 1.15-1.16 as momentous for EUR/USD. The past two weeks of November confirmed this: this entire time the pair has been moving east along the horizon 1.1600, and its main fluctuations, aside from rare inconsistencies, were within the boundaries of 1.1575-1.1660. It was in this upper border of the side corridor that the pair completed the weekly session;
- GBP/USD. This pair has been in a horizontal trend within 1.3035-1.3320 for more than a month. As for this past week, it saw the bulls try to win back losses of the first days of November. However, pushing away from the lower border of the channel, they were able to rise only slightly higher than its Pivot Point, finishing close to the level of 1.3200;
- USD/JPY did not bring any surprises. As expected, it once again tried to test the upper boundary of the mid-term lateral channel 108.00-114.50. And, as expected, after having failed, it took a breather and sank to the support of 113.00, drawing out a textbook descending channel on the chart;
- Recall that two weeks ago, 75% of analysts, with full support of technical analysis, said that USD/CHF would certainly try to gain a foothold above 1.0000. This scenario turned out to be 100% true. However, without the support of EUR/USD, the forward momentum of the pair dried up: never reaching the final target of 1.0100, it moved to a lateral movement, ending the five-day period at 0.9960.
As for the forecast for the coming week, summarizing the opinions of analysts from a number of banks and brokerages companies, as well as forecasts made on the basis of a variety of methods of technical and graphical analysis, we can say the following:
- EUR/USD. An overwhelming majority of experts (65%) vote for the growth of this pair, albeit a small one. In their opinion, having beaten off from strong support / resistance level 1.1665, the pair should go up: first to 1.1725, and then another 100 points higher. Both graphical analysis and about 70% of indicators on H4 agree with this scenario. However, when switching to the D1 timeframe, the picture changes to the opposite - here most of the indicators predict the pair's fall to 1.1555. The following support is in the 1.1475 zone;
- The outlook for GBP/USD is negative: over 60% of analysts and graphical analysis on D1 think so. The nearest support is at 1.3035, and in case of its breakthrough – at 1.2870. An alternative point of view is expressed by 15% of experts and by indicators on D1, but even here a quarter of the oscillators signal the pair is overbought. As for the remaining 25% of analysts, in their opinion, the pair will continue to move in the lateral channel 1.3035-1.3320;
- The forecast for the USD/JPY fluctuates between neutral and negative. 70% of experts and about a half of trend indicators and oscillators vote for a downtrend. 40% of the indicators have taken a neutral position, while only 10% of them light up green. Nevertheless, 30% of analysts side with the bulls. The targets remain the same as previously. For the bulls, it is to try to gain a foothold above the upper boundary of the mid-term side channel, which is 114.50. For the bears, it is to return to the Pivot Point of this channel in the 111.70 zone;
- USD/CHF. As often happens, the forecast for this pair mirrors the forecast for the EUR/USD, with this case being no exception. 65% of experts with the support of indicators on H4 predict the pair will fall to support 0.9860. The remaining 35% of analysts disagree with this: according to them the pair will rush again to storm the height of 1.0100 from the very start of the week. As for graphical analysis, it offers an alternative opinion on D1: an initial descent to the level of 0.9860, followed by a rise to 1.0100, and then by lateral movement in this channel.
Roman Butko, NordFX