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Market Outlook for week July 6th

Here’s the market outlook for this week:

Dominant bias: Bearish
Current events in the Eurozone will continue to shape the movement of EURUSD and other EUR pairs this week. Last week saw this pair open with a gap down of about 200 pips before an upward run of over 300 pips occurred on Monday. Tuesday saw price begin to head south, managing to test the support line at 1.1050 on Wednesday. Price then consolidated for the rest of the week. With the Greek referendum taking place today, EURUSD and other EUR pairs are likely to open with gaps this week too, followed by strong movements should that happen. The outlook for EURUSD is bearish: unless the resistance line at 1.1250 is overcome, further southward movement is expected.

Dominant bias: Bullish
This pair traded downwards on Monday – reaching the support level at 0.9250. From there, price headed 250 pips north – testing the resistance level at 0.9500, only to reverse again as a bearish correction took price 100 pips back down. Last week closed around the support level at 0.9400, but another rally is likely. The bias remains bullish as long as the support level at 0.9250 is not breached.

Dominant bias: Bearish
Following recent sideways movement, Cable broke down- going below the distribution territory at 1.5600. The accumulation territory at 1.5500 is an easy target for bears as there is a clean Bearish Confirmation Pattern in the market right now. Should price go further south, the accumulation territory at 1.5400 is the next target, but this does not rule out the possibility of attempts to rally.

Dominant bias: Neutral
There is no significant movement on USDJPY yet – price just oscillates between the supply level at 124.00 and the demand level at 122.00. That makes the present market condition great for scalpers and intraday traders, but not for swing and position traders. Eventually, price will break one of those levels and trigger a significant movement. If so, the most probable direction for July 2015 is down, and that is also true of most other JPY pairs.

Dominant bias: Bearish
At the open of the market last week, this cross gapped down by about 400 pips – slamming into the demand level at 134.00, then immediately rose sharply by over 400 pips to test the supply zone at 138.00. Price then got caught in an equilibrium phase for the rest of the week. The Eurozone situation will determine what happens on this cross this week as, whatever happens to EURUSD will trigger almost identical movement in EURJPY. The most likely overall direction is down.