FX.co ★ Daily analysis of major pairs for July 4, 2014

EUR/USD:  After failing to break the resistance line at 1.3700 to the upside, the price has dived by almost 100 pips. The dive is strong enough to override the recent bullish bias on the market. This means that it is no longer sensible to seek long trades in the market, for there is now a Bearish Confirmation Pattern in the chart.

USD/CHF: As a result of the stamina of this currency trading instrument, there is a new long trade indication. The long trade indication would be especially strong when the price tests the resistance level at 0.8950. This would be possible as the USD continues to be strong. The Williams’ % Range is already in the overbought region, showing that this bullish journey is strong. Despite any possible transitory bearish correction along the way, the price should go further upwards.

GBP/USD:  After much hesitation and challenge around the accumulation territory at 1.7150, the strong Cable went further upwards. The next target is at the supply territory at 1.7200. Since the Cable is now going into a negative correlation with its EUR/USD counterpart, there may be some pullbacks in the price as the market journeys upwards.

USD/JPY:  This pair remains bullish, but because of a sudden surge in JPY energy, there is currently a bearish correction. For the bullish outlook to continue to make sense, the bullish correction should not take the price below the demand level at 101.50.

EUR/JPY:  The situation on the EUR/JPY is really precarious, since the recent bias is bullish, but the EUR has become weak while the JPY is trying to show some energy. One may need to wait to see what the market may do next before taking a decisive action.