Hi Traders!, Weekly Forex Forecast 18th September 2022 is here. In this post, I analyze and forecast EURAUD and EURCAD. EURAUD is expected to continue its current corrective move upside, and I expect it to rally further after a pullback. EURCAD just broke above a very strong resistance area on the daily chart, and I believe it is a sign that the buyers are stepping in. A detailed analysis of these two instruments are as follows:
You can watch the video explanation of this forecast here:
W1 – On the weekly timeframe, after the three slowing waves to the downside currently the price is bouncing from a support zone around the 1.45 psychological round number. We also have a bullish divergence based on the MACD and RSI indicator which is a strong indication that the sellers might be losing their momentum at the moment.
D1 – Looking at the daily chart, we could see that the price has completed two false breaks with bullish divergence based on the MACD and RSI indicator. After this, RSI climbs and holds above 50 level and in the chart the price has created higher highs.
I believe the price has created the first leg of the on going potential two waves correction. Currently, the price has reached a strong resistance zone around the 1.50 psychological level where the falling resistance line coincides and I believe that we might see a possible slow down.
H4 – Looking at the H4 chart, we could see that the price after creating three waves to the upside is currently slowing down with the price developing a bearish divergence based on the MACD and RSI indicator. I believe we might see some sort of pullback here.
In the longer run my plan here is to buy the dips heading towards the resistance and swing highs shown in the image below, which is slightly below the 1.55 area. The next area would be the volume zone shown in the image below around the 1.5775 area and the resistance zone around the 1.60 area should be our final destination.
W1 – On the weekly chart we had a massive bearish trend and the price which was moving lower has spiked below the psychological level 1.30 which we may consider as a representation that the control of the sellers is slowly balanced now. We also have a slow down bullish divergence on the MACD histogram and the RSI indicator slows down as well.
D1 – On the daily chart, the price has completed a false breakout with a bullish divergence on the MACD and RSI indicator. For the first time we can see the price has closed and is holding above the volume area and above the swing highs line shown in the image below.
In my POV, as long as the low shown in the image below holds my plan here is to buy the dips aiming towards the target zone around the 1.35 area.
There is also a good chance that the price might take us beyond the 1.35 area, towards the 1.40 area.
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Certified Financial Technician