Market Update – April 30

S&P 500 FUTURES (ES) DAILY

Wow.  I did NOT imagine that the S&P would be back at these levels.  As I type in after hours trading, ES is taking out the 2/28 close.  Volume on 2/28 was the highest since August 2011 (U.S. debt downgrade).  High volume days are important because they represent a ‘vested interest’ at that specific area.  For this reason, the close of high volume days are good candidates for support/resistance.  That level is 2939.75.  A drop back below this price would at least offer a risk point to trade against.  Other than that, I’ll note the 200 day average at 2997 as a level worth monitoring.  Anecdotally, a friend texted me today to tell me that she has signed up for Robinhood (a stock trading/investing app).  This person has never once asked about the market and I don’t think its a coincidence that the text was sent after a nearly 800 handle rally.

EURUSD HOURLY

EURUSD is constructive towards the mentioned 1.1043 initially but if this is a 3rd or C wave then 1.1239 is in play at minimum.  Levels to pay attention to into and during ECB (always beware the spikes) are 1.0915 and 1.0840.  I want to buy into 1.0840.

4/27 – I like EURUSD higher against Friday’s low of 1.0727.  As noted yesterday, action since the March low is 5 waves up and 3 waves down.  The first big level to pay attention to on the upside is 1.1043, which is where the rally from Friday’s low would equal 61.8% of the rally from the March low.  Proposed support for long entry is the 61.8% retrace of the rally from Friday’s low at 1.0778.  There are several observations on the daily chart that are worthy of note as well (daily chart is below).  Friday was a J-Spike, as was the day of the March low.  Friday’s low was also at daily reversal support (close of the low day on 3/23).  Daily RSI is bouncing along 40, which is a positive.  Finally, the 200 day average and April open are in line with the noted 1.1043!

USDJPY HOURLY

USDJPY is breaking down.  The most bearish interpretation treats the drop from the 4/23 high at 108.05 as a ‘3rd of a 3rd’ wave.  If just something corrective, then 105.05/20 is ideal support.  Trading focus though is on shorting as close to the red trendline as possible.  The broad resistance zone is 106.92-107.40.

AUDUSD 4 HOUR

AUDUSD is at ‘a level’ but reversal evidence is lacking.  When I take a step back, it’s clear that the major level is .6685 (goes back to August lows).  Price could pull back from the current level, which is the center line of the channel from the April low.  If it does, then watch for support from the 25 line (magenta line), which is .6485-6500 on Thursday and/or the lower parallel and 4/14 high at .6445.

4/27 – AUDUSD has taken out its 4/14 high and rally from the March low now consists of 5 waves.  The implication is that price drops in 3 waves in order to correct the 5 wave rally.  With price above .6449, ideal resistance is now the mentioned .6523 along with the underside of the red trendline and 3/11 high at .6540.  Bottom line, focus on .6523/40 for a high.

USDCAD 4 HOUR

Lower lows and lower highs = downtrend.  If a channel is drawn from the March high, then the center line comes in at the 4/13 low of 1.3855.  Watch for a bounce there.  If it does bounce, then ideal resistance is 1.4010.  Downside targets over the next week are 1.3607 (61.8% retrace of rally from 12/31) and 1.3465 (trendline confluence and 2/28 high).