Howdy Folks,

I hope you had a great weekend! I spent my Sunday afternoon in a corn maze which was a hoot! The market open wasn’t terribly exciting. I didn’t see any interesting gaps or shocking weekend news that I’m aware of. Many of the major pairs are consolidating after their large runs over the last two weeks. NZD/USD printed an inside bar on it’s weekly chart which might be interesting to watch over the next week or so, I wonder if this pair is finally running out of steam. There is some interesting price action on EUR/USD and USD/CHF that is worth talking about.

USD/CHF

$1.06 finally gave up support four weeks ago after a long battle with sellers that lasted nearly the entire 3rd quarter. I think from a resistance perspective this level is now an interesting target for the market to test. I have no idea when it will reach $1.06 or if it even will but it is something to watch for over the next few trading weeks. If you measure Fibonacci ratios from the consolidation high of $1.1025 to the breakout low of $1.1090 you’ll see 50% falls right at $1.06. If we see a test of resistance and a turn lower this currency pair may be headed to the 150% extension of $0.9770. Only time will tell and price action will always lead the way. In the short term, I wouldn’t be surprised to see a bargain day opportunity bid this pair up to $1.06.

EUR/USD

Above $1.48 Euro has been held back by resistance, but I wonder how long that will last. The breakout above $1.44 has yet to be tested as support and I suspect that may happen soon. If we draw Fibonacci ratios using the low preceding the breakout to the high around $1.48 we see 61.8% fall just above $1.44. This corresponds with broken resistance on the daily chart which may become support as it is tested from above. The bias I have through the use of an HMA would potentially be to sell this pair if a bargain day opportunity appeared but only time will tell what is going to happen. These are rough Sunday thoughts and I’ll wait for Monday’s close to evaluate the market again.

Best of luck this week!

Ryan

IMPORTANT NOTICE: These comments are for information purposes only. My opinions or other information contained in this post do not constitute investment advice. It should not be understood as a direct recommendation to buy or sell any currency contract or other investment vehicle. Forex trading involves substantial risk of loss and is not suitable for all investors.