Good morning guys, hope everyone had a good weekend and is excited for the week ahead.
We are expecting a week full of fundamental news starting with CPI data being released this Tuesday followed by the Mario Draghi speech at 7pm that day.
On the Wednesday at 7pm we have US FOMC, definitely something worth keeping an eye on.
I won’t go through everything that’s being released this week as there is a lot, there are a few key pairs I will be looking at though for the upcoming week.
Using Fibonacci Retracement on the 4 Hour chart we date back to mid June. At the start of August we had the 23% level as Resistance, come September we have seen this level broken and tested Three times in one month, on the Fourth time we have a break and close under the 23% level. Between October & December we’ve had Three more tests of the 23% level before finally breaking back through and pulling back. We are approaching the 38% and a break and close above or below the 1.17100 region will indicate which way this pair is moving, I Predict a re-test of the 23% Level which should see a movement of 70-80 pips.
With GBP/USD again I am using Fibonacci Retracement from the start of September as we can see Two failed attempts of breaking the 50% level which is acting as Resistance. At the end of November we have seen a break of the 50% level and a test of the 78% level before a pullback to the 50% which is now acting as Support. With in a short period of time we have had a failed re-test of the 78% level. We now sit in a crucial area & wait for a re-test or break of the 50% level. If the 50% level acts as support we could see a potential movement of 140 pips. If we see a close and break Below 1.33500 we could have a minimum movement of 100 pips to the downside.