Market Update 1/27 – Last Chance for Gold

SPOT GOLD DAILY

Gold cut through the proposed support zone with ease has already reached the lower parallel of the Schiff fork from the August low.  This is ‘last chance’ support for gold in my opinion.  If price doesn’t hold here then there is no reason from my vantage point to consider the long side.  1830 is now resistance on a bounce.

1/26 – Gold dumped off of resistance and is into the proposed support zone of 1805/20.  The top side of the zone is 2022 VWAP.  The bottom of the zone is the 1/18 low, 200 day average, and 50 day average.  A short term trendline is just above that level.  The well-defined 1814 is also in the vicinity.  Bottom line, watch for a show of support.

DXY WEEKLY

DXY DAILY

DXY surged to its best level since July 2020 today.  The underside of the trendline from 2011 is a few ticks above the current level but be aware of the 61.8% retrace of the decline from March 2020 at 97.73 and a parallel near 98.30.  I remain of the mind that DXY is topping.  This surge will present an opportunity to fade extreme sentiment at a well-defined level…probably in the next week.  A zoomed in view is below.

EURUSD WEEKLY

EURUSD has reached weekly reversal support.  For those unfamiliar with this term, it’s the close of the low week of the prior trend.  In this case, that is the March 2020 low week close at 1.1132.  Obviously, there is no evidence of a reversal at this point.  Until there is, wait in the weeds like a lion stalking prey.

AUDJPY 4 HOUR

If AUDJPY breaks below the center line of the channel from the October high, then I’ll look to increase short exposure.  Specifically, the underside of the center line will be proposed resistance.  Downside levels of interest remain 78.84 and 76.80s.  The path mapped out on the chart is not a prediction but rather a possibility and the path that would allow for increased short exposure.

1/25 – Keep an eye on AUDJPY.  Monday’s low tagged the center line of the channel from the October high.  The 25 line cuts through former lows and is in line with the well-defined 82.10…watch that for resistance.  A break lower would target 78.84 and 76.80s, which is 2 legs down from the October high and the lower parallel of the channel.  If price breaks below the center line then the underside of that line becomes resistance.  Bottom line, there are solid reference points that should help return to the short side.

EURAUD DAILY

EURAUD is respecting the bullish fork that originates at the February 2021 low.  The median line was resistance in December and the lower parallel was support last week.  Even the 25 line was provided resistance earlier this week.  The point is that price is adhering to the structure, which should allow for a precise entry on the long side.  I like the long side now but will look to enter on either a drop back to the lower parallel near 1.5650 or a breakout above the line off of the August and December highs.  That is currently about 1.6030.