TECHNICAL OUTLOOK EUR/USD
As stated in the last two years of articles for FX Trader Magazine, our long-term forecast continued to stress the top in the EUR/USD since 2009 [at 1.4740], the forecast subsequent decline to 1.1555 for March 2014, and 1.0460 for 2016 in
the ongoing seven-year Dollar Bull Market Forecast. The difference now is that the forecast further decline in the EUR/USD is at risk in our forecast final year of the Dollar Bull Market. I would not be concerned about an extended consolidation and an adjustment in timing if we were one year earlier.
FX
Terefore, we continue to forecast the decline to .9890, out to June 2017 from January 2017, but not the extended further decline to .9330 strong long- term support previously for August 2017. We continue to forecast the subsequent six months’ consolidation [ .9890 – 1.1020] through January 2018 as the long-term bottom begins to build for the Euro. Only a monthly close in EUR/USD above 1.1305, down sharply from 1.1715, would now terminate the bearish long-term technical aspects of the market, complete the bottom for the EUR/USD, and result in a strong retest of 1.2230 in a higher, choppy outlook [1.0880 - 1.2230] over the subsequent twelve months.
GBP/USD EUR/USD
GBP/USD has remained bearish in our long-term outlook for the last two years. Te extremely strong and historic “Brexit Decline” in GBP/USD has produced a premature decline to the 1.3655 ongoing long-term objective for October 2016. In the process of this premature decline, the further strong decline through 1.3655 to 1.1950 developed the strongest complex medium-term divergences in a year.
Whereas the Euro continues to complete the bottom, we continue to forecast a weak rally to 1.3180 weak medium-term
resistance, GBP/USD
down sharply from 1.3795, out to June 2017 from February 2017, in the forecast subsequent, broad, and volatile, neutral/bullish outlook. We continue to forecast the subsequent consolidation into December 2017 [1.1950 – 1.3445]. Only a monthly
FX TRADER MAGAZINE April - June 2017 39
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