Forex Outlook | Can the USD get weaker?

The main European currencies remain within a long-term range started in December 2014 for the EUR and June 2016 for the Cable.

In both cases, the currencies are moving to the upper boundary of this sideways scenario, testing the sideways trend reflected in the dashboards.

The GBPUSD is trapped within the 1st attractor, after a first try-out on reaching the 2nd one at 1.4455 – 1.5232, while it is developing a potential corrective wave visible at the daily scale.

GBPUSD weekly scale

We can see above how the negative movements are still balanced with the positive (persistence and stats tables) but distribution in the spectrum and the speed are giving signs of intention to move up once the correction at the daily time frame is completed and finished.

GBPUSD daily scale

From the high at 1.4240, the Pound went down in 5 visible overlapped waves. This pattern can be a simple – complex double zigzag, but as the trend remains negative, exist the possibility of a new low to the attractor at 1.3628 – 1.3504 if the quote remains below 1.3858.

On the other hand, the Euro is moving upward after reaching the attractor at the weekly range, within the ideal distribution area for time and speed between motive and corrective waves (marked with the orange lines).

EURUSD weekly scale

But the trend remains bearish, increasing the chances of more lows as the pattern at the daily time frame is aligning to a motive – corrective sequence to the downside.

EURUSD daily scale

The EURUSD is within a non-trend zone between 1.1766 and 1.2188, for this reason, more confirmation is needed to see a continuation of the bearish trend or a reversal.

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