Market forecast for week ending 10th to 15th may 2021

EURUSD

EURUSD is currently in a narrowing/terminal wedge touching off from two points in the bottom and top areas of the pattern. EURUSD is currently trading below the wedge top a confluence of resistance zone around 1.2150.

Unless we get a break out from 1.2150 the bottom of the wedge around support 1.175 is a possible outcome given that wedges like this needs at least three touches to be tradable. Supports include 1.200 and 1.1750

A close above 1.2150 will expose the year to date high 1.2350 followed by 1.256. EURUSD daily time frame

GBPUSD

The last the I wrote about the cable I talked about the breakout from the bull flag the ensuing consolidation and what it may mean. Today put the cable 134 pips above 1.400 resistance. 1.400 has resisted the buyers since February, a daily close above 1.400 which is most likely to happen and the next resistance is 1.4250.

The future direction of GBPUSD hinges on 1.4250;a rejection from here will produce a bearish divergence in the form of a double top. If we get a double top we may see the cable fall to 1.3480 which is the 50% retracement of the September 2020 to march 2021 rally.

A break above 1.4250 will expose 1.503Daily time frame

AUDJPY

The last time I wrote about AUDJPY I wrote about the 1,897 pips inverse head and shoulders on the weekly chart below. Price consolidated below 84.95 for 10 weeks before breaking through last week exposing 87.333 if 84.95 support holds on retest. Above 87.33 there is a minor resistance 89.075 and final objective of the inverse head and shoulders at 96.16.

There is also an ascending trend line on the daily chart which is also respected on the weekly time frame. The trend line suggests that buyers still have control as long price stays above it in both the and weekly time framesAUDJPY weekly time frame

AUDJPY daily time frame

XAUUSD

I wrote about Gold’s double bottom in the descending channel that I have been writing for weeks now. As expected gold rose to 1637 pips and is trading below 1850 resistance. The future direction of Gold depends on what happens at 1850. A rejection from 1850 or a sell signal will send Gold down towards 1806.

A break out from 1850 will most likely put an end to the nine month consolidation and send gold higher towards 1910 and 1970Daily time frame