There are similarities between the current gold rally and the rally into the 2011 top. Price has met the line off of the February and August 2019 highs (highs of proposed waves 1 and 3). The same line (line off of proposed waves 1 and 3) met the 2011 high (see below). However, in 2011, the 161.8% extension of waves 1-3 identified the high. In the current market, that isn’t until 2095. GLD RSI actually registered a record on 7/29. Today’s reading is slightly lower but the only time that RSI has been at this level or higher is last week, in June 2019 (minor pullback followed) and on 8/10/2011, which was just before the high. Those charts are below. Bottom line, pay attention to gold from here to 2095.
GOLD FUTURES DAILY (INTO 2011 TOP)
GLD DAILY (INTO 2011 TOP)
The 8/2 update laid out the technical reasoning for some sort of a high in EURUSD. Micro structure reveals the importance of 1.1825. The noted high volume level is there along with the 61.8% retrace of the decline and 2 equal legs up from Monday’s low. Big level and where I’m watching for resistance.
8/2 – Euro futures put in a rare volume reversal on Friday (note the red bars on this chart). The volume reversal along with VWAP from the 2018 high, long term channel resistance (see 2 charts down), and a perfect Elliott channel (see 1 chart down) presents a compelling bearish setup. I’m looking towards 1.1500. Resistance should be the high volume level at 1.1825.
EURCHF is trading against channel resistance from the 2018 high. As long as the level holds, I’m looking lower.
EURGBP 4 HOUR
It’s been over a month since what I’m viewing as a lower high within a bearish cycle from the March high in EURGBP. The battle lines are drawn for breakdown. .9000 (or so) is clearly important. I’m willing to go with a break below that level.
6/30 – Maybe Cable is REALLY bullish. I can make the bullish case for GBP crosses in general. EURGBP, for example, sports 5 waves down and 3 waves up since the March high. The 3 wave rally retraced almost exactly 61.8% of the 5 wave decline. .8980-.9000 is the breakdown zone.
USDJPY 4 HOUR
USDJPY has pulled back slightly following Friday’s big reversal. Focus for the next pivot is 105.05/30 (61.8% retrace and 7/30 high). The zone is reinforced by parallels within the channel from the March high. Notice the number of pivots at the parallels that are equidistant from the center line. This illustrates the concept of symmetry in median analysis that I often reference.
8/2 – The USDJPY drop from the March high consists almost exactly of 2 equal legs. Friday’s reversal occurred on 2x the 20 day average of volume. The last time that Yen reversed from at least a 50 day high on 2x volume was in October 2011. That ended up being a major Yen high (USDJPY low). I’m bullish against Friday’s low. Neat term levels to pay attention to are 106.15 and 105.30.
Everything since the 2015 low in AUDUSD may be a massive double bottom. Above the June high at 1.0880 would be an early breakout warning. The ‘real’ breakout level is 1.1300. I laid out reasoning for near term downside in both AUDUSD and NZDUSD over the last few days but a broad bottoming out in AUDNZD (still just a possibility) suggests that Kiwi short is the better option.