This week we traded both the EUR/USD and AUD/USD currency pairs. As mentioned in the previous week’s post, we expected a trend confirmation on the EUR/USD, but did not receive one until the end of the week as we waited for support confirmation at the 1.46260 area. The consensus is that we did receive a slight market correction on this pair as we went down to test support, but it looks like next week will resume the bullish trend continuation. The AUD/USD currency pair, being over-extended, showed an uptrend correction as the U.S. dollar began to show strength this week. We were able to capitalize on the retracement, but an uptrend continuation still remains likely.

The primary currency pairs of focus for this week were the EUR/USD and USD/JPY. While we did not end up trading the EUR/USD, we did notice a yearly high at the 1.49938 area, which meant for either a potential trend reversal or continuation, thus leaving uncertainty in market direction. However, we marked this pair for trade reconsideration after we allow price action to develop more. This pair has been in a strong uptrend since March, so a point of exhaustion or consolidation is nearing. We did trade the USD/JPY this week as it continued in bullish nature. Despite the low average daily range of this pair, we were able to profit as price moved to retest the monthly high and resistance area.

This week we focused solely on the EUR/JPY currency pair after noticing a major potential uptrend. Sure enough, price broke above the 132.220 resistance area and continued throughout the week to the second area of resistance being 135.480 for a total of 260 pips. We expect this pair to reach new highs in the next few weeks before selling off. While we did look at other currency pairs, the EUR/JPY had the best setup for a breakout with an acceptable average daily range.