Market Update – April 20

GOLD DAILY

Gold reversed from massive resistance last week (long term parallel is shown on the weekly chart below).  I am bearish…at least near term.  If the decline from last week’s high unfolds in 5 waves, then I’d be confidently bearish against the high and look to short a rally.  For now, just know that levels to watch are 1672.50 for support (keep in mind that this is futures and not spot) and 1724.20 for resistance.

GOLD WEEKLY

USDCAD 4 HOUR

I like the USDCAD long setup with entry on the top side of the broken trendline.  That line intersects 1.3940, which is where the drop from the 4/16 high would consist of 2 legs.  Upside focus remains 1.4336/57 (weekly reversal resistance and 61.8% retrace).

4/16 – USDCAD stalled after spiking through 1.4160s.  Trading focus remains higher with ideal support now narrowed to the 61.8% retrace of the rally from this week’s low at 1.3980.  This would also be near the top side of the trendline that crosses highs since 3/23 (blue line).

NZDUSD HOURLY

The only change to Kiwi analysis is proposed resistance for the lower high (B wave).  2 equal legs from .5922 is .6071, which is in line with the 3/27 high.

4/16 – NZDUSD, which has lagged AUDUSD, is probably a better near term short.  The decline from this week’s high is impulsive and probably wave A of an A-B-C corrective decline because the rally from the March low is in 5 waves (impulsive…view an hourly line chart to see that waves 1 and 4 do not overlap).  The implication is that price bounces in wave B before turning lower in wave C.  Focus for resistance is .6030.  Initial downside focus is the 4th wave of one less degree at .5843.