Home / Technical Analysis / Weekly Forex Forecast: August 24, 2020

Weekly Forex Forecast: August 24, 2020

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Major Stock Indices Overview

S&P500 US Index

The S&P500 index closed at record levels after testing the supply zone around 3353.16-3398.03 levels last week with a gain of +0.72%.

The index is trading above the 50 and 100 moving averages that act as strong support levels. The index might retrace back down to 3319.97 or 3269.56 levels before resuming its upward movement.

The next potential targets are 3528.01 and 3678.83 levels as price could continue moving higher.

The overall market sentiment is generally positive as the US existing home sales numbers surged better than expected last Friday. During the weekend, the chinese media reported that a vaccine for COVID-19 has been approaved for clinical trials by the National Medical Products Administration. This could boost market sentiment on Monday and push the S&P500 index above current price.

S&P500 Forex Forecast
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FTSE100 Index

The major European indices closed lower on Friday with the UK’s FTSE 100 falling -1.5%, the German DAX -1.06%, and France’s CAC -1.47%.

The index is trading below the 50 moving average and finding support around the 100 moving average. The price is still moving sideways between 5841 and 6277 levels.

The slow progress on finding trade agreements seemed to go nowhere for Brexit talks during last week. This could negatively impact both the FTSE and the GBP. More to come next week as the sentiment is still bearish in this market.

FTSE 100 Forex Forecast

Nikkei 225 Index

The Nikkei 225 index closed at 22885 with a loss of -1.58% last week. The index tested the supply zone and moved down to test the 22708 level. The price action suggests that price might retrace back up and shows a bullish continuation to the upside.

The index is still trading above the 50 moving average with 100 MA crossing above the 200 MA.

If the price breaks below the 22323 level, the next potential target is the 21670 level.

Nikkei 225 Forex Forecast

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Forex Market Forecast

At the open of the US session last week, the strongest currencies were the JPY +2.44% and GBP +1.34%, against the weakest currencies the USD -1.08% and CAD -3.11%.

US Dollar Index

The index created a new demand zone around 92.530-92.970 levels and showed enough bullish evidence to the upside.

If price continues to move higher, the next target would be to test the 94.281 level as a first target. If price is unable to break above previous high, the index could trade lower and break below the 92.530 level.

The COT report shows slightly more bears than bulls with 53.3% net long positions versus 53.9% net short positions.

US Dollar Index Forex Forecast

EURUSD

On the daily chart, price tested the supply zone around 1.19180-1.19950 levels and showed enough bearish evidence to the downside.

As long as price doesn’t break below the previous low, we could expect price to retrace back up and test the 1.19488 and 1.21182 levels. If price manages to break below the previous low, the next targets are the 1.16550 and 1.14942 levels.

The COT report shows more bulls than bears with 13.3% net long positions versus 8.9% net short positions.

EURUSD Forex Forecast

GBPUSD

On the daily chart, price is moving sideways with a potential brea to the downside. On the 4H chart, we can see that price created a new lower high and a new lower low confirming a potential bearish momentum on GBPUSD.

If price continues to move lower, the next targets are the 1.28889 and 1.26451 levels.

If price finds support around the 20 moving average and continues to the upside, the next target is the 1.35338 level.

The COT report shows more bulls than bears with 23.6% net long positions versus 21.7% net short positions.

GBPUSD Forex Forecast

AUDUSD

On the daily chart, price tested the supply zone around 0.72110-0.72950 levels and kept moving sideways. As price closed below the 20 moving average, price might retrace back down to 0.70852 and 0.69705 levels.

If price doesn’t break below previous low and starts trading above last week’s high, the next potential targets are 0.72947 and 0.74837 levels.

The COT report shows more bulls than bears with 29.6% net long positions versus 18.4% net short positions.

AUDUSD Forex Forecast
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NZDUSD

On the daily chart, price tested the supply zone around 0.66390-0.66900 levels and showed bearish evidence to the downside.

If price breaks below the 0.65052 support level, the next potential target is to test the 0.64321 level. If this support level holds and the price starts moving up, the next targets are the 0.6678 and 0.68121 levels.

The COT report shows more bears than bulls with 35.4% net long positions versus 44% net short positions.

NZDUSD Forex Forecast

USDCAD

On the daily chart, price moved sideways between supply and demand zones. If price continues to move higher and breaks above the supply zone around 1.32210-1.32630 levels, the next potential target is 1.32926 level.

If price breaks the previous low, the next target is to test the 1.31290 level.

The COT report shows more bulls than bears with 33.5% net long positions versus 10.1% net short positions.

USDCAD Forex Forecast

USDCHF

On the daily chart, price created a new demand zone around 0.90090-0.90650 levels and showed some bullish evidence to the upside.

Price might retrace back up and test the 0.91862 level before moving down to test the 0.89526 level as the sentiment is bearish on this pair.

If price breaks above the 0.91862 level, we wait until it tests the supply zone around 0.92970-0.93510 levels to short the pair.

The COT report shows more bears than bulls with 9.4% net long positions versus 35.3% net short positions.

USDCHF Forex Forecast

USDJPY

On the daily chart, price tested the demand zone around 104.080-105.040 levels and showed enough bullish evidence to the upside.

If price breaks above the previous high, we expect price to move higher and test the 106.800 and the 107.880 levels as potential targets.

If price fails to move higher and breaks below previous low, the next targets are the 104.627 and the 103.132 levels.

The COT report shows slightly the same percentages with 16.1% net long positions versus 16% net short positions.

USDJPY Forex Forecast

Commodities

Gold

On the daily chart, Gold created a new supply zone around 1974.96-2015.52 levels and showed strong bearish evidence to the downside.

As price tested the demand zone around 1863.24-1921.84 levels and showed rejection to the upside, we expect Gold to test the 1974.96 level and if we have enough bearish evidence to the downside, we short Gold. The targets are 1906.57, 1869.16, and 1807.18 levels.

Gold Forex Forecast

Crude Oil

On the daily chart, price is trading within a narrow range with a possibility of breaking above the 42.91 level.

Crude Oil Forex Forecast

Risk Disclaimer: By viewing any material or using this weekly forex forecast within this site, you agree that it is general educational material and you will not hold anybody or entity responsible for loss or damages resulting from the content provided here by “TradingFXHub”. Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. Past performance is not indicative of future results. The results found in this weekly forex forecast are based on simulated or hypothetical performance results that have certain inherent limitations. Individual results vary and no representation is made that clients will or are likely to achieve profits or incur losses comparable to those that may be shown.

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