#EURUSD & #GBPUSD Forecast: Weekly Forecast (6–12 November 2022)

EUR/USD: Weekly Forecast 6th – 12th November

The EUR/USD remained under 1.00000 all of last week, but its trading results demonstrated sharp price action which is likely proving opportunistic.

Speculators of the EUR/USD that enjoy volatility are getting plenty of price action delivered on a daily basis. The EUR/USD remains below parity and the currency pair was not able to trade above 1.00000 the entirety of last week. Intriguingly, the inability to climb above the 1.00000 did not even happen as the U.S Federal Reserve was set to deliver their interest rate hike this past Wednesday, when some financial houses may have been expected to wager aggressively on the EUR/USD with buying. Muted buying is intriguing technically.

The EUR/USD did climb early on Wednesday to highs near the 0.99750 mark briefly. This upwards momentum was likely based on the notion, which proved to be wrong, that the U.S Federal Reserve would offer more dovish interest rate policy. In fact, the U.S Fed not only raised its interest rate by the expected 0.75% addition, but essentially said, it is too early to begin thinking about a change of interest rate policy.

EUR/USD trading below the 1.00000 may entice Bullish Speculators, but should it?

After the U.S central bank kept its monetary policy enflamed with ‘red hot’ rhetoric as it continued to sound alarm bells regarding inflation, the EUR/USD sank quickly. The 0.98300 mark was quickly seen on late Wednesday via selling. And then on Thursday after the Bank of England recession chatter being delivered along with another interest rate hike too, the EUR/USD sank further to a mark of nearly 0.97250.

The European Central Bank did raise its interest rate nearly two weeks ago. However, the ECB is looked upon as being rather unimpressive regarding its rhetoric regarding the battle to engage inflation throughout Europe. The EUR/USD has now been battling parity since the middle of August and the inability to sustain highs over 1.00000 seems to becoming the norm. Behavioral sentiment remains fragile and perhaps financial houses are getting used to a range of 0.97500 to 0.99500. Taking advantage of resistance has likely proven worthwhile for some traders.

• Choppy conditions have been fast in the EUR/USD, and traders looking for upwards momentum when support is touched may continue to wager. The mark of 0.97500 looks to be a technical area that buying has manifested.
• Yes, the EUR/USD can certainly trade above the 1.00000 ratio, but resistance does look rather strong above the 1.00800 mark.

Range Trading and a New ‘Normal’ for the EUR/USD

The EUR/USD still may need attitude adjustments for some speculators who believe the currency pair is oversold. In the long-term bullish speculators will likely be proven correct, but until sustained price action is attained above the 1.00000 lasting longer than a handful of days, perhaps even a few weeks, the price of the EUR/USD may simply range within its current realms. The shadow of the U.S Federal Reserve remains strong, particularly as they threaten more hikes to come over the mid-term.

EUR/USD Weekly Outlook:

Speculative price range for EUR/USD is 0.96800 to 1.01000

Can traders take advantage of the relatively new and low range of the EUR/USD?

The EUR/USD has been in a long-term bearish trend and although some speculators may feel like the time has come for a shift in technical direction, this might not occur in the near-term. Trading conditions on global markets remain nervous and economic clouds continue to create pressure in the European Union. The EUR/USD did move to a low of nearly 0.97250 last week, which came within sight of lows seen the previous week. Traders wanting to be buyers when support is tested cannot be blamed, but they should be careful.

The EUR/USD may be starting to demonstrate durable support for speculators. The fact that the EUR/USD was able to climb higher on Friday and finish near its high for the week is of interest technically. If the EUR/USD opens with solid gains to start this week, it is not out of the question the EUR/USD could climb above parity and challenge highs seen on the 26th of October, near the 1.00950 mark.

Looking for quick hitting results may prove to be the best risk taking strategy in the coming days. Traders should also keep in mind the U.S mid-term elections that will take place this Tuesday and could cause volatility if the results produce a surprise.

GBP/USD Forecast: Weekly Forecast 6th – 12th November

The GBP/USD displayed another week of volatility which likely caused surprises which were both good and bad for speculators pursuing the currency pair.

The GBP/USD has delivered another week of rather nasty volatile results for speculators who like to trade one of the world’s most famous currency pairs. Whipsaw like price action probably caused plenty of harm to speculators unprepared for the rather steep swings in value which also sparked solid reversals. Rather than being a polite and quiet Forex pair that a speculator can pursue with tranquil results, the GBP/USD fell and rose as nervous sentiment reacted to data and central banking policy.

The GBP/USD will begin this coming week significantly below its starting point last week. Tomorrow’s opening should be watched carefully to see where behavioral sentiment takes the GBP/USD next. The starting point will be around the 1.13728 realm upon opening, but speculators should count on fast conditions to remain dynamic in the near-term.

Central Banks were Noisier than Expected Last Week and the GBP/USD Responded

On Thursday, after the Bank of England’s interest rate hike and rhetoric that the U.K is in recession and the public should expect tough economic months ahead, the GBP/USD sank like a stone to the 1.11450 vicinity. This happened after Wednesday’s price action which remained almost calm when the U.S Federal Reserve said it will continue to remain rather hawkish regarding interest rate policy. Instead of offering tranquil words for financial houses, both the Federal Reserve and Bank of England rattled sentiment and left traders feeling more uneasy about outlook.

• On Friday the GBP/USD did recover and climbed back to nearly the 1.14000 level before giving up some value and going into the weekend. Early last week – on Monday – the GBP/USD did trade above the 1.16000 juncture briefly.
• Storm clouds on the horizon and behavioral sentiment could affect the GBP/USD this week once again.

U.S Mid-Term Elections are this coming Tuesday and Results will Cause a Reaction

U.S mid-term elections will take place on Tuesday and it appears the Republican Party in the States may recapture control of the Congress and Senate. What this means for U.S economic policy is unclear, but it may mean that a shift in government stimulus policy will slow down, which investors may be keen to see. However, the vote needs to happen first and if the Democrats hold onto power in Congressional halls, this may create further worries. On Wednesday morning a solid idea will be known regarding where power is situated. Financial houses tend to like when Washington has a White House ruled by one party and Congress is ruled by another. This mixed result could actually create more calm for the GBP/USD, but will it happen?

GBP/USD Weekly Outlook:

Speculative price range for GBP/USD is 1.11470 to 1.17450

Having touched a fast and volatile low of nearly 1.11450 last week, traders know this depth can happen again. However, the thought process that this number may act as a very durable support barrier may prove to be logical. Certainly the GBP/USD has traded below this value in the past couple of months, but in the coming week, speculators may feel that targets of 1.13000, 1.12750 and 1.12500 below are justified. If the GBP/USD sells at these depths it would seem to be oversold. Traders may use these values as a place to ignite buying wagers while looking for upside reversals.

Nervous conditions are quite strong and the results of the GBP/USD may continue to demonstrate this fragile sentiment. However, from a speculative point of view for betting on the GBP/USD, it would seem anything below the 1.12400 mark should raise suspicious eyebrows technically. Yes, the GBP/USD has traded lower as already noted, risk management will be essential.

Speculators aiming on moves upward should remain realistic. Targeting results above 1.15500 may be a stretch too far, but limited buying pursuit seems justified from a speculative point of view. Financial houses based on the volatile and choppy conditions last week are still likely looking for ‘fair’ equilibrium in the GBP/USD and may believe the price should be slightly higher.

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