Hi Traders! Forex Weekly Forecast Text Format October 4th to October 9th 2020 is here. My team and I always continue to work very hard for you and your success and as we do every week, we have prepared two great gifts for you!
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In this pair according to the analysis I have on the daily timeframe the price has reached a key supportive area from 1.30. This is where the bullish divergence was completed on the moving averages and histogram of the MACD indicator.
Also, the long falling downtrend line was successfully broken.
And the price which is moving higher has broken above the resistance zones shown in the screenshot below and currently it is retesting this area.
So the way I see this based on the daily chart we might still be experiencing a corrective cycle now before the price moves higher further. Now for this to happen, we need to go to the H4 chart and find the opportunities.
Looking at the H4 chart we could see that with every pushes to the upside the price is gaining momentum. Right now it looks like the price is in a corrective phase. So basically the zone shown in the screenshot below becomes a potential support zone to look for a possible continuation higher.
As you can see in the screenshot below the price is facing a strong support zone and as long as this area holds I will be expecting the price to go higher further.
We may see the price pushing lower into the supportive zone in the form of two waves. Or it may try to spike through the rising trend line and then it may go back above it and start the rally.
Or alternatively, it might simply hold this bottom and regain the momentum by creating higher highs, higher lows, and return to the bullish scenario.
So basically in my POV as long as the price successfully holds the support zone shown in the screenshot below I would be looking for the buy opportunities with bullish evidences, expecting the price to create a second leg to the upside.
In this pair, my idea from the previous week was to look correction and then one more leg to the upside. The price moved as per my plan and we got the corrections. On the H4 chart based on the current scenario, I do expect the price to make one more push forward.
The main reason for this is because based on the weekly chart the false break below the strong support zone shown in the screenshot below and the bounce from the 0.90 level most likely would make the market to try and push a bit further before anything else could happen.
Based on the daily chart’s bullish divergence I would expect the first leg shown in the screenshot below to complete and then we may expect a correction to happen (maybe a deeper one) and then possible continuation higher. The way I see this, it’s too early for the buyers to give up.
On the H4 chart in my POV the price is currently experiencing the corrective wave and we may see the price trying to create one more low to complete the MACD bullish divergence. As long the supportive area shown in the screenshot holds I would expect the price to find the bottom and go higher further.
In order to gain this momentum, I would want to see this pair gaining the structure to the upside in the form of three higher highs, higher lows as shown in the screenshot below.
Currently, the price has created smaller waves in the form of three higher highs higher lows but as you can see in the screenshot below it is stuck inside a range between the two big candles. This is why I wanted to see the price getting out of this range and gain momentum in the form of three higher highs, higher lows. We may then expect the price to continue higher further.
In this pair, my idea from the previous week was to look corrections and then a continuation lower and I expect the daily target to be reached. The correction is in play now (it’s a bit deeper one than I expected).
On the daily chart, the price is in a very strong corrective phase and it makes me think that we might experience a deeper ABCD correction towards the zone shown in the screenshot below. Or alternatively, the price might continue to move for a while inside the range shown in the screenshot below.
So the way I see this we might be experiencing one of the following two scenarios. The price might create an ABCD correction as shown in the screenshot below possibly to the top of the daily range or to the falling resistance connecting the lower highs, lower lows scenario, and the bearish divergence to complete itself.
If this bearish divergence manages to complete then I do find this to be very interesting as I see it as evidence for a possible continuation lower.
The alternative scenario here would be, the price has already created three lower highs, lower lows and then we got the correction followed by bearish hidden divergence on the H4 chart.
And looking at the H1 chart we could see that the price has created two lower highs, lower lows, and break below the low shown in the screenshot below would trigger the third lower lows. We may then look for pullbacks and then a potential continuation lower.
In this pair, my idea from the previous week was to look for retraces and then corrections down. The retraces that we were looking for happened as expected. My current view on this pair is bearish and I expect the cycle shown in the screenshot below to complete.
On the H4 chart, the price has broken below the supportive zone and currently, the price is retesting this area. The price is also respecting the channel shown in the screenshot below and currently, it is at the top of this channel. So based on all this, my personal view remains bearish here.
In my POV there are two possible scenarios here to follow, they are, the price might create one more push higher towards the downtrend line or maybe even false break above that. We may then expect the price to break below the most recent uptrend line and move lower further.
Alternatively, on the H1 chart, the price has created two lower highs, lower lows, and break below the low shown in the screenshot below would trigger the third lower lows. We may then look for pullbacks and then a potential continuation lower.
Note: Technically this is what I expect from this pair.
For the longer view, I expect this pair to be in the corrective phase which means this correction could be in the form of an ABCD pattern as shown in the screenshot below.
Or alternatively in the form of a range.
Dropping to the lower timeframe we are currently experiencing the corrective phase and right now the price is approaching a very strong zone.
So the way I see this, if the price manages to create the final high around the strong resistance zone shown in the screenshot below, then it should be a good area to look for short-term bearish evidences expecting the price to move lower further.
Personally I would like to see the H4 and H1 charts synchronizing the bearish divergence around the key resistance zone then I would be looking for evidences for possible sells.
In Gold, my idea from the previous week was to expect the price to create one more low. So on the H4 chart, I wanted to see the pullback and then further continuation lower. Currently, the pullback is in play and the price has reached a strong resistance zone where the 1900 psychological round number coincides. And also we have a bearish slope on the dynamic resistance of the 200 moving averages.
In addition to this, we may consider the last series of highs as a hint for the bearish direction.
On the H1 chart, I would be looking for bearish evidences. We already have false breaks and if the price moves lower, breaks below the last low and creates a bearish convergence. We may then consider it as evidence of bearish pressure and expect the price to move lower further.
Or alternatively, if the price creates three lower highs, lower lows we may consider this as evidence of bearish pressure and expect the price to continue lower further after pullbacks.
In Dax, my idea from the previous week was to expect corrections and then to look for bearish evidences. Currently, it looks like a correction is happening and I am not convinced that this correction is over yet. There are two possible scenarios from here on the H4 chart, the price has created three lower highs, lower lows followed by a correction, the price has reached a clearance zone with bearish hidden divergence and the price is gaining momentum since in the form of lower highs, lower lows.
As long as the 61.8% fibonacci retracement zone of this bearish trend pattern holds I expect the price to continue lower further.
Or alternatively, if the price moves higher and breaks above the 61.8% fibonacci retracement zone and completes the bearish divergence and goes below the clearance zone. We may then expect the price to continue lower further.
This or the other way around my view remains bearish here because on the daily chart we had a bullish cycle as shown in the screenshot below with a massive bearish divergence and I expect a corrective cycle to happen here. The corrective cycle could be in the form of an ABCD pattern.
Or alternatively in the form of a range.
This is why the bearish pressure remains on in my POV.
I have more instruments in my list which I will cover this week in the Live Market Analysis in Traders Academy Club.
This is how the report looks like. A table with the hottest market opportunities, screenshot behind every pair and time frame (anything that is in blue inside the table is clickable and leads to a screenshot) + a summary in text format, kind of highlights. And of course Live Market Analysis every single day. If you want to enjoy similar trading ideas as they come live (we run our Live Market Analysis on daily basis, where we analyze the market choosing the synchronized opportunities as we see them) I invite you to join our Traders Academy Club
Note: Bullish evidences could be in the form of candlestick patterns, false breaks, trend line breakout etc… supporting the bullish view and bearish evidences could be in the form of candlestick patterns, false breaks, trend line breakout etc… supporting the bearish view.
Once again I invite you to join me in my Live Market Analysis, on daily basis, and improve your trading with us.
Also, you can get one of my strategies free of charge. You will find all the details here
I wish you a wonderful trading week
Yours for your success,
Certified Financial Technician