Market Update 12/7 – Watch this Level in USDOLLAR

USDOLLAR 4 HOUR

All eyes should be on the month+ USDOLLAR channel line.  As noted last week, a break below would serve as the trigger that the USD has finally turned.

12/2 – We got a prediction headline.  The following is courtesy of the WSJ.  Whether Omicron Wreaks Havoc or Not, the U.S. Dollar Is a Buy

Prediction headlines indicate extreme confidence in the direction of the trend.  This is the same psychology that led to Powell capitulating on inflation.  I’m extremely bearish the USD.  Whether or not we get a spike higher following NFP is a complete guess but pay attention to this short term channel in USDOLLAR.  A break below would serve as the ‘all clear’ that the USD is about to dump.

AUDUSD DAILY

AUDUSD composes a quarter of USDOLLAR.  The low last week (Friday) was .6993…2 pips above the November 2020 low.  The rally appears impulsive so I’m keen on buying a pullback.  Watch for .7060 support.  The pullback may come from near .7170, which is the September low and was resistance last week (see below).

12/1 – AUDUSD is closing in on the massive .6990-.7050 zone.  The bottom of the zone is defined by the November 2020 low and the top of the zone is the 38.2% retrace of the rally from March 2020.  The December 2019 high at .7032 is in the middle of this zone.  NFP is Friday.  One of my favorite counter trend setups is for a capitulation low on NFP.  Bigger picture, mid-.6400s could be in the cards in 2022 (see below).  My immediate focus however is trading into proposed support.

AUDUSD HOURLY

USDCAD 4 HOUR

USDCAD tanked today.  Near term downside focus is 1.2560/70, which is the trendlne and 200 period average on the 4 hour chart.  If that breaks then the well-defined 1.2500 is the next swing level.  1.2712/45 is proposed resistance now.  This zone was former support (top of the zone was also resistance previously).  BoC is tomorrow.

12/6 – USDCAD broke short term trendline support, which is the trigger I’ve been waiting for to trigger a short.  Resistance should be the underside of the line near 1.2780.  The 61.8% retrace of the rally from 10/21 is 1.2500, which is in line with the September low.  Consider that a soft target for now.

USDNOK HOURLY

A decent top appears in place for USDNOK.  Price reversed sharply lower on Monday.  The daily chart below shows daily J-Spikes at 1 year high/lows.  Near term, the drop from the high is impulsive, so strength should prove corrective.  Proposed resistance is 9.10.

USDNOK DAILY

USDJPY 4 HOUR

USDJPY is nearing 114.  If USDJPY is a short, then resistance is probably closer to the 61.8% retrace at 114.38.  This price is line with a trendline that crosses pivots since early September.

12/2 – No change but you’ll want to have this chart front and center with NFP tomorrow.  I want to short USDJPY near 114.

AUDJPY 4 HOUR

AUDJPY followed through on Monday’s reversal.  Similar to AUDUSD, the rally from the low appears impulsive which suggests that additional upside is in store following a pullback.  Proposed support is near 80 (12/1 and 12/2 lows along with VWAP from the low).  Proposed resistance remains 82.00/30.  I prefer trading AUDUSD but wanted to share AUDJPY given it’s usefulness as a barometer of risk.

12/6 – AUDJPY low on Friday was at the top side of former trendline resistance and the September low.  This is a good spot for a bounce (this pertains to ‘risk’ in general).  82.00/30 is well-defined for resistance.  Watch for support at 79.40/50.