GBPUSD held VWAP from the March 2020 low on Friday. As noted last week, lower parallel support is slightly lower near 1.3320 (see below) though. If the rally from last week’s low extends into a small 5 wave advance then I’ll want to but a small dip.
The cleanest setup from my vantage point at the moment is in gold. Price has broken out (remember 1834 was possible resistance…it didn’t do anything so it’s support) and 1834 is proposed support. Former resistance is reinforced by the top side of the line off of the 2020 and May highs along with the center line of the short term bullish channel (which was formerly resistance). Upside focus is the May high at 1916.
Since USDCAD is USDCAD, it had to test Friday’s high before reversing lower. In any case, there is no change to the view that a 5th wave lower is underway. I don’t have all of the measurements on the chart because I like to keep it clean but realize that wave 3 is exactly 161.8% of wave 1. If today was the 4th wave high, then wave 5 would equal wave 1 at 1.2184. This is in line with the 5/13 high at 1.2203. Bottom line, I’m looking towards 1.2200ish. There is a high volume level at 1.2459 that is proposed resistance now. Finally, an 8 hour volume reversal triggered today (see futures chart below, which extends back one year).
Crude traded up to 84 (a bit above) and has gone straight down since. 82.20 is now proposed resistance if crude bounces. Downside focus is the July high at 76.98 and possibly the top side of the LONG TERM former resistance line (now support) near 73. The weekly chart below shows the this long term chart in its entirety.
Action since the October high in EURJPY is probably a 4th wave. As such, expectations are for a 5th wave rally to a new high. A possible target is 134.29, which is the 61.8% retrace of the 2014-2016 decline and where the rally from the May 2020 low would consist of 2 equal legs. Watch for support near 132.00.
BTCUSD is off 13% since the top last week. If price drops under the short term lower channel line near 56830 then weakness will be considered impulsive and ‘waterfall’ weakness would be on the table. Watch for resistance near 61850. The weekly chart is shown below. This looks ‘toppy’ to me. Yes, ‘toppy’ is an official technical term. Former trendline support has provided resistance on the way up, a doji candle formed last week, and the rally failed after taking out the prior high. Seems bearish. Finally, is BTCUSD trying to tell equities something (see 2 charts down)
No change to USDCAD but I’m re-posting the chart because BoC is tomorrow. I continues to favor the scenario in which the bounce from 10/21 is a 4th wave. Ideal resistance is 1.2470/90 (38.2% retrace of well-defined pivot since June).
EURJPY sports 5 waves down from the 10/20 high so watch for resistance near 132.79 (4th wave high). The 10/20 high is on the upper parallel from the fork that originates at the September low. Eventual proposed support is the lower parallel, which intersects with the September high at 130.75.
USDCAD has spent 4 days trading around the 61.8% retrace of the rally from the June low. Also, today’s long lower wick and 4 hour volume reversal (see below) suggest that a relief bounce could take hold. With resistance probably not until 1.2490s, I’m willing to trade the long side against today’s low.