CURRENCY WATCH EUR/USD
As stated in the last three 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], as well as the forecast subsequent declines to 1.1555 for March 2014, and 1.0460 for October 2016 in the ongoing seven-year Dollar
Bull Market Forecast. By rallying from the low to complete the monthly close back above 1.1305 in June 2017, we crossed our “line in the sand” and terminated the Dollar Bull Market.
Te impact on the EUR/USD has been a neutralizing of both the bearish long-term momentum as well as a neutralizing of most other technical
FX
aspects in the currency pair. Te result was the further bounce in the Euro through 1.2040 to 1.2555. Tis last leg up again dampened improving medium-term technical factors within neutral. We are now forecasting a retest of 1.2155 through May 2018 in a tight, choppy consolidation [1.1865 – 1.2555] through August. We are forecasting a subsequent rally to 1.3190 through October 2018, then a subsequent higher consolidation [1.2420 – 1.3190] into January 2019. Only a monthly close in EUR/USD above 1.3190 (resulting in a new leg up to 1.3990 strong long-term resistance over six months) or a monthly close back below 1.1830 (terminating the forecast rally to 1.3190 and yielding a decline to retest 1.1280 over four months) would change our gradually improving medium-term outlook.
GBP/USD EUR/USD GBP/USD
When our bearish forecast for GBP/ USD was completed with the decline to the 1.3655 long-term objective in June 2016, the further deep and brief decline to 1.1950 developed the strongest complex medium- term divergences in a year. Te rally that ensued from 1.1950 through our 1.3810 medium-term corrective objective for February 2018 to close the month above 1.3990 improved the medium-term technicals to neutral/ bullish. We are forecasting a further rally to 1.4565 through May 2018 in a sharply higher, volatile medium-term outlook [1.3875 – 1.4770] through July 2018. Only a monthly close back below 1.3875 (resulting in a decline
FX TRADER MAGAZINE April - June 2018 29
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