DXY and USDOLLAR remain in flux (one more push higher as per the 4th wave interpretation?…see yesterday’s post) but EURUSD action from the low is constructive. Price rallied in 5 waves and declined in 3 waves therefore I lean towards the long side against 1.1772. Also, don’t forget that Euro futures are holding VWAP from the March low (see below).
Kiwi continues to play out beautifully. .7000 has provided resistance the last 3 days and focus remains on .6750-.6800. RBNZ is tonight (Wednesday in New Zealand) so it’s possible that we get a flush into .6800 or so before a rebound. For us, this sets up a possible opportunity to flip from short to long.
EURUSD held VWAP from the 2020 low (again) so near term focus is higher towards the center line of the channel from the January high, which is about 1.1935. Importantly, notice that the 75 line provided support therefore the 25 line is proposed resistance if reached (as per median line symmetry). The 25 line intersects the 61.8% retrace of the decline from the May high at 1.2081. Watch for support near 1.1825.
Pound futures made a daily volume reversal today. The signals shown are at least one year high/lows with at least 1.5 x the 20 day average volume. Those are some timely signals. Price is testing the center line of the channel from the April low (see spot chart below). In the event of a bounce, resistance is 1.4210. Near term downside focus is the lower parallel, currently near 1.4005.
EURJPY action since the October low has taken the form of a wedge. The rally stalled this week after taking out the September 2018 high but I’m wondering if we get a final spike into 134.30, which is both the 61.8% retrace of the decline from the 2014 high and 2 equal legs up from the 2020 low. A close-up view is below.
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.
EURUSD has reached 1.1845 (2 legs down). The 200 day average is about 1.1815. A bounce from either one of these levels wouldn’t be a surprise so watch for resistance now near 1.1950 (median line of short term bearish fork and February low). Another downside level to be aware of is VWAP from the March 2020 low at 1.1742. This is in line with the 11/11 low and lower parallel of the bearish fork. Bottom line, 1.1740s is the next most important downside level and 1.1950 is proposed resistance.
EURUSD broke below the center line of the channel from the March 2020 low and that center line is now proposed resistance if reached along with former support in the 1.2020/60 zone. The next 2 downside levels of interest are 1.1845 and 1.1600. The first level is 2 equal legs down from the high. The lower level is the 1.618 extension and the former 4th wave low (November low).
BTCUSD bounced sharply today with stocks and commodity currencies…still all the same trade. Price could turn down right here, which is VWAP from the high and possible channel resistance. At minimum, risk is well-defined for those looking to position for downside in BTCUSD.
50-51 is big for crude. This zone was critical support in 2019. Once the level broke early last year, crude went into a swan dive. As noted 2 days ago, the rally from the April negative print does compose 5 waves. 5 waves up plus a massive market level in the form of former support (turned resistance?) indicates reversal potential.
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