Strength in NQ doesn’t negate the call for 11805 but focus for resistance now is a bit higher…roughly 13000/120. This is line that connects highs from the top, 2021 VWAP, and VWAP from the high (see futures chart below).
3/8 – 12727 held as resistance and immediate focus is on the noted 11805, which is now just above the 200 day average. That is a huge spot and the biggest test since the drop started in mid-February.
I’m looking for gold’s bounce to extend slightly higher. There are 2 levels to keep in mind for resistance…1735 and 1790. The first level is the median line of the fork from the August high. The second level is the 25 line from that structure. Watch for support now for a short term long near 1700.
Lo and behold, USDOLLAR reversed lower just as mainstream financial publications ‘noticed’ the rally. The median line that price reversed off of is critical. Notice how the line was support in September and resistance in December. Also, notice how parallels within the structure have nailed the big turns. Until/unless price takes out the median line, I’m cautious on USD upside. If the USD is going to break above the median line over the next week or so then I’d expect support near 11728/44 (see 4 hour chart below). This chart also highlights the manner in which I think about markets/trading. That is, identify decision points and make decisions with capital at those points! This is in contrast to blindly adhering to a specific narrative/direction.
3/7 – 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.
USDJPY nailed resistance and reversed (high today was 109.23). Simply, I am looking lower until roughly 107.00 (the next decision point?). Proposed resistance is now 108.80ish (see 4 hour chart below).
3/7 – 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.
USDCHF reversed sharply lower today. The full extension of the channel from the low was resistance along with the underside of the line off of lows in 2015 and 2018 (that longer term chart is republished below). .9319 (last week’s high and today’s U.S. session high) is now proposed resistance. Downside focus is the top of the former upper parallel near .9150.
3/7 – 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.
The 61.8% retrace of the rally at 1.2575 has held as support but USDCAD has churned sideways for the last 6 days. That may change with BoC tomorrow. I’m watching for a spike under 1.2575 to complete a small 3 wave correction before another leg higher.
3/3 – USDCAD tested the trendline from the March 2020 high yet again last week. A break above would indicate an important behavior change (bullish). Until then, keep the 61.8% retrace of the rally from the low in mind for support at 1.2575.
USDTRY ripped through what I thought would prove resistance but reversed sharply lower today. The proposed pattern (A-B-C from the low) remains favored. The B wave could bring the rate back to 7.23 or so (former 4th wave low and 61.8% retrace). Proposed resistance is 7.7050-7.7100.
3/7 – 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).