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Fundamentals bring EUR/USD choppiness, yet with USD/CAD and NZD/USD both at crossroads, this week will be crucial for forex direction.

CFDs are a leveraged product and can result in losses that exceed deposits. Trading CFDs may not be suitable for everyone, so please ensure you fully understand the risks and take care to manage your exposure.
Source: Bloomberg

EUR/USD choppy following Greek deal
Many had expected a Greek deal to be treated with glee for EUR/USD bulls, yet the markets showed their unpredictability, with the dollar actually enjoying a very strong day, pushing this pair lower. Friday’s swing higher came in lower than the one posted on 29 June, which has provided us with a bearish outlook.

Thus I expect us to see a move below 1.092 as this would continue the downtrend in place over the past three weeks. The inability to move below 1.092 would mean a more bullish sentiment would begin to come through. However, with the fundamentals absolutely dominating the price action of this pair, I believe there are better instruments out there to trade.

GBP/USD shooting star gives way to losses, yet remains bullish
GBP/USD posted a shooting star candle on the daily chart yesterday, bringing with it a bearish outlook for today’s proceedings. However, there are reasons to believe that we will see further gains in the near future.

The price is currently resting on the 1.5442 support level, which represents both the 4 June peak and 19 May trough. Given that the stochastic oscillator is exhibiting a bullish cross in oversold (this has been a reliable performer recently), there is a high possibility that we bottomed out again last week. As long as the price remains above 1.5442, I am bullish and expect another bounce higher with the initial resistance at 1.5552 and 1.559.

USD/CAD breaks out of consolidation phase
Today is seeing USD/CAD breaking higher from the consolidation that has dominated trading over the past fortnight. The 100% Fibonacci expansion at 1.2772 provided a short-term reprieve from the incessant rise of the pair, yet we are seeing an attempt to punch higher today.

However, be aware that there is arguably a more relevant resistance level at 1.2835, which is the 18 March high, which if broken would provide a new six and a half year high. Given the downward trajectory of oil, the CAD is likely to track its movement and thus any further losses would likely result in further upside in USD/CAD. Thus I will be watching both crude charts and the reaction to 1.2778 to gauge whether another correction or retracement is likely.

NZD/USD at key support level that could spark further upside
The NZD/USD pair has been a picture of reliability in recent months, falling by almost 15% in the past two months. Whilst the beginning of last week saw a bounce higher, this is not out of the ordinary for the pair and as such I have been watching for another leg lower in the near future.

However, for this to happen we would need to see a move below the 0.6663 support level. Should that not occur, we could be seeing the beginning of a stronger correction that first thought. Thus a move below 0.6663 would likely bring a very quick move to the 0.6618 lows before continuing to head lower. However, the inability to close below 0.6663 could see us move back towards the recent 0.6777 swing high set last week.

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CFDs are a leveraged products. CFD trading may not be suitable for everyone and can result in losses that exceed your initial deposit, so please ensure that you fully understand the risks involved.