Market Update 5/11 – Yen Crosses Breaking Down?
USDJPY has broken the trendline from the late March low. I’m bearish. 130.40/50 is now proposed resistance.
Market Update 5/10 – Tracking EUR / Commodity FX Setups
EURAUD sports a 2 month bottoming pattern (similar to the 2 month topping process in AUDJPY). Price is nearing the 3/15 high at 1.5329 which could produce a reaction lower. ‘Ideal’ support for a long entry is 1.4940s, which includes former resistance and the top side of the line off of the 3/15 and 4/25 highs.
Market Update 5/9 – Resistance in Bond Yields?
DIA (Dow ETF) levels are extremely well-defined. A massive top is completed and the biggest level on this chart is 297.50 (or so). A drop to that level would represent a 20% drop from the all-time high. In the grand scheme of things, that’s fairly normal. Possible trading levels before then include 313.50 (VWAP from the March 2020 low) and 332.70 for resistance (former support). The full view of the structure from the 2020 low is shown below.
Market Update 5/5 – The Reversal Reverses
Today’s Dow move is important because price plummeted from the center line of the Schiff fork that originates at the 2009 low. In simpler terms, this line has been key support and/or resistance for years (note the highlighted areas…zoomed in chart is below). Consider the market in dangerous territory while price is beneath this center line.
Market Update 5/4 – Consensus Trade Reversals!
Violent reversal indeed. I’m of the mind that this rally has legs given the massive 1.0500 figure and extraordinarily bearish sentiment. Upside focus is 1.0840 or so, which is the underside of the trendline from the 2017 low and median line of the bearish fork. Support is 1.0570/90 (see below).
Market Update 5/3 – Upside SPX Levels of Note
SPX held up after yesterday’s reversal. There are 2 big levels to note for possible resistance…4250 and 4360/90. The latter level seems like a stretch in the near term but FOMC is tomorrow and sentiment is wildly bearish, which provides plenty of fuel for a violent squeeze. Bottom line, I’m thinking higher following yesterday’s reversal, especially after futures held the large volume level during Tuesday’s trade (see below).
Market Update 5/2 – SPX Squeeze Time?
SPX took out the 2/24 low (invasion low) before reversing higher to finish with a high volume reversal (see below). The low was right at the median line of the bearish fork too. Sentiment across virtually all major asset classes is insanely extreme (USD, bonds, and equities). The median line tag and reversal from under the February low is a perfect setup for a squeeze higher. If however price breaks below the median line then the market would be in crash territory.
Market Update 4/2 – GBPUSD and NZDUSD Levels in Focus
GBPUSD tagged the topside of the trendline from the 2015 high. Again, this line crosses 3 yearly highs. Daily RSI is below 19. Prior readings this low over the last 20 years are shown with magenta dots on this chart and the following 2 charts. The combination of the level and the RSI reading have me on reversal watch. Stay tuned.
Market Update 4/27 – Extreme Momentum Readings in GBPUSD
GBPUSD is nearing the 61.8% retrace of the rally from the 2020 low at 1.2495. The top side of the trendline that originates at the 2015 high (blue line) is just below this level near 1.2415. The next 3 charts highlight when daily RSI is below 21 over the last 20 years. All instances led to at least interim lows EXCEPT during the financial crisis. So, unless this is the financial crisis, we should be on the lookout for a reversal.