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ICYMI: Monday Market Breakdown

The US Dollar (USD) declined during Monday’s European session as political concerns in Europe receded, shifting focus to France’s upcoming election. This reduced safe-haven demand for the USD. Meanwhile, the Japanese Yen (JPY) continued to weaken against the USD, nearing the critical 160.00 level, which previously triggered intervention by Japan’s Ministry of Finance. Economically, lighter data is expected this week, including the Dallas Fed Manufacturing Business Index for June. In case you missed our weekly market review on the YouTube channel, here are a few trade ideas.

AUDUSD – H1 Timeframe

The 1-hour timeframe of AUDUSD as seen on the attached chart is currently under pressure from an area of supply, with increased confluence as a result of the sweep of the previous high, followed by the bearish break of structure. The supply zone and the 88% of the Fibonacci retracement tool helps solidify my sentiment as bearish, with an initial target at the 23% level.

Analyst’s Expectations:

  • Direction: Bearish
  • Target: 0.66390
  • Invalidation: 0.66810

EURUSD – H4 Timeframe

EURUSD as seen on the 4-hour chart recently had a massive reaction off the confluence of the trendline support, and the drop-base-rally demand zone. As indicated by the slanted arrowed line, I am expecting price to keep pushing higher because of the Fair Value Gap price left behind as a result of the very volatile break below the previous low, and the fact that price swept liquidity from an induced low right before tapping into the area of demand.

Analyst’s Expectations:

  • Direction: Bullish
  • Target: 1.08182
  • Invalidation: 1.06481

GBPUSD – H4 Timeframe

The price action on the 4-hour timeframe of GBPUSD recently broke below the support trendline of an ascending channel, implying the onset of a bearish trend. On that basis, I have plotted a resistance trendline that overlaps a supply zone and is supported by the 50 and 100 moving averages as confluence for the bearish sentiment. The 88% of the Fibonacci is another factor worth considering in favor of the bearish sentiment.

Analyst’s Expectations:

  • Direction: Bearish
  • Target: 1.26489
  • Invalidation: 1.27439

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