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Charts for Next Week: EUR/USD, USD/JPY, USD/CNH, and Gold Price

Charts for Next Week: EUR/USD, USD/JPY, USD/CNH, and Gold Price

Paul Robinson, Strategist

We continue to focus on a few of the same pairs/markets as last week; a couple with their themes changing and a couple with their themes gaining traction. This week, the euro showed some pep in its step as it quickly put the wedge/11500 breakdown to the test; is this a sign of a broader reversal? USD/JPY hasn’t been an easy handle, but with it breaking out of a descending wedge, a path higher may smooth things out. USD/CNH continues to be high on the radar as signs of a broader reversal gain traction. Same goes for gold.

Technical Highlights:

  • EUR/USD, big bounce or reversal?
  • USD/JPY may gain clarity, finally
  • USD/CNH high on radar for a move lower
  • Gold reversal anticipated to continue for now

To check out our intermediate-term fundamental and technical outlook on major markets and currencies, see the Q3 Trading Forecasts.

EUR/USD, big bounce or reversal?

The turnaround in the euro in recent sessions has quickly put the downtrend in question as the 11500-mark and wedge prior to the breakdown are overtaken. The trend-line from April is currently helping to keep a lid on a further advance, but a break could go a long way towards bolstering the reversal scenario.

EUR/USD Daily Chart (bounce or reversal?)

EUR/USD daily chart, bounce or reversal

Check out the Q3 Euro Forecast for a broader fundamental and technical view.

USD/JPY may gain clarity, finally

USD/JPY has been a mystery as of late, but that could finally change. The descending wedge we discussed on Wednesday was broken yesterday, and with it the possibility of seeing higher prices increases. A smallish pullback from around current levels may at some point offer a good entry with a higher low from the earlier week low developing.

USD/JPY Daily Chart (Descending wedge/pullback scenario)

USD/JPY daily chart, descending wedge/pullback scenario

Check out the Q3 Japanese Yen Forecast for a broader fundamental and technical view.

This set-up along with gold sits at the top of the board. The strong weekly reversal last week coupled with the developing head-and-shoulders pattern on the 4-hr time-frame are beginning to make for a solid set-up. The key to this trade gaining momentum is seeing price decline below the neckline. For more details on this set-up, check out the USD/CNH piece from yesterday.

USD/CNH 4-hr Chart (H&S to play out next week?)

USD/CNH 4-hr chart, head-and-shoulders scenario

Gold reversal anticipated to continue for now

Gold is continuing to try and make a recovery at the least, if not more. Yesterday’s pullback may be all we see before continuing higher, but even if we see a little more weakness first, a higher low is seen as having decent probability of setting up the metal for a move to 1210 or better.

Check out the Q3 Gold Forecastfor a broader fundamental and technical view

Gold Daily Chart (Reversal to continue…)

Gold daily chart, reversal to continue...

Resources for Index & Commodity Traders

Whether you are a new or an experienced trader, DailyFX has several resources available to help you; indicator for tracking trader sentiment, quarterly trading forecasts, analytical and educational webinars held daily, trading guides to help you improve trading performance, and one specifically for those who are new to forex.

---Written by Paul Robinson, Market Analyst

You can follow Paul on Twitter at @PaulRobinsonFX

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.