Market Update 3/7 – USD Testing Big Level

SPOT SILVER 4 HOUR

Silver is bouncing after sliding to its lowest level since late January.  The trend lower is intact and focus for resistance is 26.48 or so.  The next downside level of interest is the January low at 24.02.

3/1 – Silver made high at 28.33 last week and is just above a possible ‘trap door’ (breakdown) level.  A break under 26.14 would lead to accelerated downside.  This level is defined by the line off of the November and January lows and center line of the channel from the 2/1 high.

USDOLLAR DAILY

Now ‘they’ are confused by USD strength.  This is from Friday – Dollar Strength Confounds Investors and Sparks Some Worries.  Of course, the ‘confusion’ over USD strength is taking place just as the USDOLLAR index is testing critical resistance.  A break above would open up the next parallel at about 12040.  My ‘guess’ is that the USD pulls back a bit here though.  11750 is a level to keep in mind for support now.

3/3 – A well-defined base has formed in USDOLLAR since mid-February.  Zooming into price action since the 2/25 low reveals an impulsive advance followed by a drop and today’s bounce.  I’m of the mind that the drop and bounce compose waves A and B of a 3 wave pullback.  Ideal support for the end of the pullback is 11634/51.

USDJPY DAILY

USDJPY is trading just above the July 2020 high and 61.8% retrace of the decline from the March 2020 high.  A huge test looms near 109.20, which is the confluence of trendline resistance from the 2015 high and the bullish fork that originates at the November low.  The median line from that fork is now possible support near 106.80.  A close up view is below.

USDJPY 4 HOUR

USDCHF DAILY

USDCHF has been surging for the last 3 weeks but the move could pause at the current level, which is defined by the underside of the line that connects important lows in 2015 and 2018.  The line was support last March and resistance in September.

GBPUSD 4 HOUR

I’m still looking for 1.3730 or so in GBPUSD before considering upside but price could bounce back into 1.3950 or so before going for the noted 1.3730.  1.3950 is near term trendline resistance.  One reason to suspect a decent bounce from Friday’s low is that 2021 VWAP held as support (see future chart below).

3/4 – Cable completed its 3 wave correction today and turned sharply lower.  Downside focus is still about 1.3730.  That level is important to the integrity of the broader bull trend (see the daily chart below) so a break below would require a reassessment of the underlying trend.  Proposed resistance is the week open price at 1.3936.

BRITISH POUND FUTURES HOURLY

NZDUSD 4 HOUR

No change to Kiwi.  I like downside following the break under the 2+ month channel.  Again, proposed resistance is about .7215.

3/4 – NZDUSD broke the 2+ month channel today so focus is lower…period.  The underside of the channel should provide resistance now near .7200.  Former lows at .7097 and .7003 are possible bounce levels but broad downside focus is the noted .6800.

USDTRY 4 HOUR

USDTRY is testing well-defined resistance and the rally can be counted as an impulse (5 waves up).  The level/pattern combination gives scope to a temporary high (probably the end of and A wave) and pullback (in wave B).

2/23 – USDTRY price action from the November top may compose a rare leading diagonal (wedge).  Price is pressing against the upper wedge barrier.  A break above would confront the 200 period average on the 4 hour chart as resistance.  The setup would be to buy a re-test of the top side of the wedge line.  If the leading diagonal interpretation is correct, then USDTRY likely retraces a significant portion of the decline from November…61.8% to 78.6% of the drop.  That’s a big move.