ForeCastle

US Dollar Forecast – US Dollar Remains in Control, but Can it Really Hold its Gains
"Momentum clearly remains in the US Dollar’s favor as it trades near key multi-year peaks, and we head into the coming trading week cautiously bullish. Yet it is likewise clear that markets could shift in an instant, and it will be important to remain nimble in what looks to be another indecisive week of price action."



British Pound Forecast – GBP/USD Bounces Up to a Lower High Ahead of UK Inflation Data
"From a technical perspective, the Sterling is still confined to the down-trending channel against its US counterpart. Today’s Doji formation may be a prelude to an evening star, and should Monday’s candle close below 1.5210, the formation will be complete, and this could be an attractive way to sell the pair."



Japanese Yen Forecast – USD/JPY Stuck in Continuation Pattern Ahead of Japan GDP, BoJ Meeting
"In turn, the fundamental developments coming out US/Japan are likely to spark increased volatility in USD/JPY as market participants gauge the next move by the Fed/BoJ, but the pair may consolidate ahead of the major event risk as it appears to be stuck within a bull-flag formation. Nevertheless, the deviating paths for monetary policy accompanied by the continuation pattern in price continues to highlight a long-term bullish outlook for the dollar-yen especially as the pair breaks out of the range carried over from back in September."



Canadian Dollar Forecast – CAD Unable to Prevent Slide As Crude Oil Breaks Support
"If banks take note, this would have the Canadian Dollar replacing the Euro as the carry trade funder, and likely add to the pressure on the Oil-driven currency to continue to see the largest capital outflow of G10FX."



Australian Dollar Forecast – Australian Dollar May Stall on FOMC Minutes, US CPI
"More of the same on display in the Minutes document may amplify Fed vs RBA policy divergence policy divergence bets, regardless of a more supportive outlook for the Australian monetary authority. US core inflation is expected is expected to register at 1.9 percent for the second consecutive month and may reinforce this dynamic."



New Zealand Dollar Forecast – Fonterra Milk Auction To Put Spotlight on RBNZ’s Next Move
"The Commitment of Traders (CoT) report showed that speculative NZD longs recently outweighed shorts by 20% vs. previous 18%. This positioning data shows that speculative positioning, which is notoriously fickle, is still convincingly long-kiwi, and that increases the risk of a sell-off if USD moves higher in near-future."



Gold Forecast – Gold: Here’s What to Look for After this Historic Run
"Look for interim resistance at 1096/99 on a rebound with only a breach above former TL resistance dating back to the 2015 highs (~1112) invalidating the near-term downtrend. A break below the July low targets objectives at the 100% extension of the decline off the yearly high at 1067 and the broader 61.8% extension of the decline off the 2012 high at 1053. Bottom line: gold prices are at risk for a near-term rebound early next week which may offer more favorable short entries."




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