What can traders expect from the forex pairs this week? Several of the curency pairs are overextended so there is a potential for market retracements or turns this week.
The EURJPY weekly chart shows that it is oversold. The last completed bar formed a reversal bar to the upside and the Stochastics is now turning up. While this may not be a market turn, price will likely retrace back up to the ATR. If the ATR (red plus sign) provides resistance, then new lows could form later this month.
The weekly USDJPY chart is very similiar to the EURJPY. A reversal bar has completed and the Stochastics, which has been oversold, is now turning upwards. A retracement back to the ATR is likely. If the ATR provides resistance then the USDJPY could begin a new descent.
The GBPUSD weekly chart shows a strong uptrend with hidden divergence off the last retracement. This typically indicates that the previous high will be exceeded.
This pattern is confirmed with the daily as there is a potential hidden divergence right at the ATR on the daily chart, as well. With the Stochastics oversold, and the potential hidden divergence, the most likely path will be upwards with an expectation of the previous high (1.4352) being exceeded.
The USDCHF weekly chart shows that the Stochastics is overbought but there is not a reversal bar yet indicating a downward move. If the ATR (red plus sign) acts as resistance, then the USDCHF could potentially make a new low in the coming weeks.
The USDCAD weekly chart shows that the currency is making higher lows but the Stochastics is overbought. The most likely path for the USDCAD is down towards the ATR (seeking a support area to help push price up). If the ATR does provide the support needed then the USDCAD could begin making higher highs later in the month.