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EUR/USD - Battle of the Head & ShouldersIt's been a few weeks since EUR/USD broke below the neckline of its head and shoulders and the response since has been a little sluggish, to say the least. The trend was starting to look very favourable for the dollar as it enjoyed a bit of a resurgence, taking out the neckline of a head and shoulders pattern in the process. Since then, it came back and tested a cluster of moving averages - 55/89 SMA band on the daily chart and 200/233 SMA band on the 4-hour chart - as well as key fib levels. This wasn't a big concern, retracements are normal and they are standard rotation points after a breakout. Since then, we've seen further resistance to the breakout and the 200/233 band on the 4-hour chart has fallen. This isn't a gamechanger, but I would say it's a red flag. The key fib zones remain in place and the 55/89 daily SMA continues to hold. As long as this is the case, the head and shoulders breakout remains valid. The concern is that an inverse head and shoulders has now formed on the 4-hour chart in the midst of all the volatility. The neckline of this isn't as clear as the one on the daily chart but what is clear is that a break above 1.22 doesn't bode well for the initial formation on the daily chart. And in fact, it could be quite a bullish signal for the pair. At the moment, it's still in tact and during his first testimony in the Senate, Powell hasn't changed that. But we're now at a critical level and things could become a lot clearer very soon.
by OANDA
2
Stocks Waiting on PowellStocks really took a dive today. It seems the S&P is fearful of what Fed Chair Powell may have to say today. Recall that part of the reason that stocks are selling off is that due to increased bond yields, investors are fearful of higher interest rates, which would dampen the easy money party that stocks have been enjoying for years. We are at a support level right now of 3847, which has further support from the intersection of a trend line and the psychological level of 3850. It is highly likely we will see a bit of support here, and it looks like we are catching a meager bounce at least. The Kovach OBV is bearish, and the Chande is turning over so both indicators are not looking too hot for stocks right now. If we break down further, watch 3825, and if we are able to break out, we will find resistance at 3887.
FX:SPX500
by quantguy
Will we see a new decline in gold?From the beginning of the year, a downtrend in H4 gold began. It represents a correction of the rise in 2020. And the main question always, is it time to buy or will we see another drop? It will become clear today! We are currently facing resistance from the trend line, as well as resistance from previous peaks. This is an opportunity to look for a new decline to the previous bottom, and in case of a break even lower. The important event today is - Fed's Chair Powell testifies Watch for movement beforehand! If you have questions about how to trade this or another situation, contact us! To support us, like and comment!
FX_IDC:XAUUSDShort
by ForexTrendline
2
Make-Or-Break for Stocks! Eyes on the Fed 👀Stocks have retraced significantly in what appears to be a megaphone-like pattern. For the pedantic, a proper megaphone pattern requires higher highs as well, which we don't seem to have, but the spirit of the megaphone pattern is expanding volatility which we do see, especially on the down side. These current levels are a make-or-break for stocks. The level 3867 is crucial here, as it is the intersection of a tend line and a technical and Fibonacci level. If we break this we will have a lot of momentum, and could easily slice through 3846 to find support at 3824 or even 3810. Fundamentally, investors are fearful that a rise in the bond yields will result in a more hawkish Fed, and stocks are loving their low interest rate environment and easy money policies. Watch for hints of the Fed's direction when Jerome Powell speaks tomorrow. If you have faith in the stock market, then any dip should be considered a buying opportunity, as once the news is digested, hawkish or not, stocks will likely rip back to highs.
FX:SPX500Short
by quantguy
Dax - Short - Post All Time HighsThe Dax has lost it's upward momentum after having made all time highs on Monday as global equities rose due to Biden's proposed $1.9 trillion stimulus package. However, downside risks remain due to the continued impact of the pandemic on the global economy as US inflation came in at 1.4% vs 1.5% forecast. We await Powell's speech later today for any significant price action and believe prices could challenge long term support around 13,000 in the coming weeks.
XETR:DAXShort
by KQMarkets
ridethepig | NZD for FED📌 ridethepig | NZD Market Commentary 27.01.2021 What is in play here? Buyers depriving shorts of their rewards and not allowing the breakdown ahead of Fed. Strategically speaking, this looks and smells a lot like a slingshot. The strong rejection points towards the Kiwi inflows after RBNZ let slip that rate cuts are unlikely. On the Fed side, dollar devaluation is still the name of the game and a dovish Powell is already widely expected. Not expecting much positivity on the recovery front, positioning is the main factor in play here and a sweep of the highs would be healthy as is the case for EURUSD. Thanks as usual for keeping the feedback coming 👍 or 👎
Long
by ridethepig
4
ridethepig | EUR Market Commentary 28.01.2021📌 ridethepig | EUR Market Commentary 28.01.2021 In this position, we have managed to build a solid floor at the 1.207x area and as widely expected Buyers fought like a lion to defend their jurisdiction. The ECB on the wires attempted to talk down the currency via threatening room for rate cuts, classic jawboning from Knot in attempt to provide shelter. They will not cut again and time to call bs; here actively buying dips in the euro - this charming position is proof of the wonderful beauty of technical analysis. Looking back to the initial start of this move, it has taken a lot longer for the flow to play out than I would have liked, however, nothing has changed and there is no reason to be alarmed. If we lose the floor and breach 1.200x, then we KNOW we are WRONG and need to reassess the view. Fed artificial dollar devaluation is here to stay and a move back towards the top of the range is the path of least resistance. Thanks as usual for keeping the feedback coming 👍 or 👎
Long
by ridethepig
11
ridethepig | Gold Market Commentary 27.01.2021📌 ridethepig | Gold Market Commentary 27.01.2021 In the middle of Fed, let's update the Gold chart! Buyers are in the habit of unpinning , by choosing the quiet break of $1,860 and then allowing a quiet congestion to justify this collection of energy based on two premises: 1️⃣ The bottom formation has taken place ahead of the event. 2️⃣ The troops (buyers) which have been brought into play since $1,803 are now going to be rewarded for their bravery , position favours the topside as sellers lose their grip . I would like to add that the same flows are also in play for Silver, from time to time I am inclined to update the entire charts to keep up with some of the unpleasantness of chop and congestion . This point of view can be seen in: The above is of course extremely obvious, and by now my dear readers you all know what is in play on the fundamental side. The pandemic worsening is stalling the economic recovery, employment is still way below comfortable levels. Softening demand, and lower CL prices have been keeping inflation down, but for how much longer...? Thanks as usual for keeping the feedback coming 👍 or 👎
FOREXCOM:XAUUSDLong
by ridethepig
15
ridethepig | EUR Market Commentary 26.01.2021📌 ridethepig | EUR Market Commentary 26.01.2021 An important chart update for euro here, which does not require to create a decision, but shows how price rolls forwards undr the direction of price drivers. It advanced quite far and cramped the highs. Finally there is another opportunity for loading on the 1.212x pivot. For the risk cocktail we have Conte resignation , covid varients , vaccine execution and delays to Biden stimulus all entering into play. These are unusual markets and volatility expansions (e.g. yesterday) are still showing that the USD remains the safest place to park capital when the storm hits. I am still of the view that we will clear initial targets , but clearly there are risks entering into the picture and trading pragmatically is important with risk in the air. For those holding longs in this swing, it's time to sit on our hands with a lottery ticket , trail our stops and take of the exposure. Thanks as usual for keeping the feedback coming on these short-term flows 👍 or 👎
Long
by ridethepig
11
ridethepig | Euro for ECB📌 ridethepig | Euro for ECB In some chart annotations, we have already covered the need for a pullback yesterday and to either use that to build the position centrally or lines aimed at mapping the flow for those covering on the pullback. The main point was to gain momentum for the slingshot after the 1.207x bids held. > Global inflation is starting to show signs of creeping higher ( see the explanation ) so expecting Lagarde to be slightly bullish EUR on inflation, neutral on growth, no changes in rates and the usual 'watching the currency closely'. The significance on the technical side is that buyers have situated themselves comfortably since Monday, as a basis for further operations, lies beyond all possible doubt. This is subtle and illustrates the deep relationship between the ECB and the dollar flank. A breach above the 1.216x highs now into sellers camp will trigger the capitulation towards our first target, play the momentum gambit when the opportunity arises. Thanks as usual for keeping the feedback coming 👍 or 👎
Long
by ridethepig
12
ridethepig | EUR Market Commentary 19.01.2021📌 ridethepig | EUR Market Commentary 01.19.2021 We should strategically protect our position, not a sickly stop or weak-looking exposure, etc. As you can see, the bids at 1.207x held and buyers as widely expected fought like a lion to defend their jurisdiction. This was not the act of Christian kindness or pity or etc, this is a strategic point that required defending from the outflows. The strength to pull back above our 1.212x pivot shows that buyers are functioning as normal, while sellers are licking their wounds and covering quickly. How to get rid of our opponent? A break above the 1.222x via a more dovish than anticipated Yellen today will get rid of any remaining sellers and force 'confidence' back into the spotlight. This will not receive tender treatment as it always comes down to the same situation: It always comes down to the same situation; a central bank which could be called sound, but which has one sickly component. As we all know by now, the longer the delay in USD devaluation from Fed, the worst the blow is going to be in Equity markets and one way or another eventually this is going to look like Fed has been financing the WhiteHouse and then the game is up. Confidence will send capital fleeing. Here eyeballing a test of 1.222x first before 1.230x. While invalidation or reassessment will be required should we breach the current floor Thanks as usual for keeping the feedback coming 👍 or 👎
Long
by ridethepig
9
ridethepig | EUR Market Commentary 18.01.2021📌 ridethepig | EUR Market Commentary 18.01.2021 Here to kick the week off with the first moves we have buyers choosing to defend the 1.207x bids, protecting the support level and relieving the channel structure of this duty so that it can become a bit more appealing possibly for a slingshot. The next moves higher in EURUSD can be the start of a swing that cracks the 2018 highs. Yearly Eurobonds Sellers have missed the proper moment to get in contact with the stops below the support. If the position were with Pound, on the other hand, the win for buyers would be much more difficult, whereas now euro follows on its own logically defined map. UK is at the heart of the matter of fundamental impacts around Brexit, the euro will be considered a stepping stone for UK outflows as sharp speculators and large macro hands evacuate through the flanks to avoid getting caught up with BOE -ve rates. To the topside 1.212x remains a 🔑 pivot level with initial targets found above at 1.222x and 1.230x while invalidation comes from a sustained breach below support. Thanks as usual for keeping the feedback coming 👍 or 👎
Long
by ridethepig
12
Gold - A Major TestGold prices fell heavily last week as US yields climbed above 1% on the back of the Georgia election results. With the Democrats having secured an unlikely blue wave, Joe Biden now has the platform to deliver on some of his more ambitious priorities, including a massive stimulus plan. The President-elect is due to outline plans as early as today, with reports suggesting he will push for a $2 trilllion stimulus package. The worry in the markets then being its impact on inflation, bond purchases and interest rates, hence the moves in yields. Fed policy makers have been trying to ease these concerns this week and have succeeded to some extent but with the 10-year still above 1%, there's still clearly some work to do. Should policy makers fail to alleviate these concerns, we could see a very significant breakout to the downside in gold, breaking below the 200/233 SMA band which has been key support since breaking above it back in December 2018. Combined with the rejection of the 61.8 fib last week, it would be a bad warning signal for the yellow metal.
OANDA:XAUUSD
by OANDA
6
ridethepig | Rate Differentials 📍 A quick update here on the elements of EUR and USD Ending the 'C' part in the swing down has been a hard struggle and with such a problem a surprising retreat is expected. Buyers are threatening to bottle up their opponent. A pullback in EURUSD towards 1.15/1.14 will make things a lot easier: Inflation is demanding a return, after sufficient preparation, watch out on the battlefield (see my explanation in the recession strategy). The other theoretically plan of attack is a flank attack in USD which must be nipped in the bud via FED but they will lag behind now. Real money understands the point behind this move. Firstly, the test of 1.70 is starting to be considered from the point of view that the current block is settled to the topside. As usual thanks for keeping the feedback coming 👍 or 👎
TVC:US10YLong
by ridethepig
6
DIS 12/21/2020 LongDIS gapped up on heavy volume over a significant level that it was bumping up against & has spent six days digesting these higher prices. I bought a half-sized position on Monday (12/21/20) when the market gapped lower due to a new COVID strain mutation in the U.K. I believe that the market is over COVID & has been for some time. Unless there is a negative development on the vaccine front, Pumpin' Powell is going to be able to continue inflating the asset bubble. The DIS pullback also coincided nicely with a bounce off of the 9-day EMA. My initial stop is below the low of the gap-up day. I'm looking to add larger size on a break of Monday's highs circa $172. I would also be willing to add on a false break & quick reclaim of Monday's lows, at which point I would move stops up to just below the false break.
NYSE:DISLong
by apaqu
ridethepig | JPY Market Commentary 18.12.2020📌 @ridethepig G10 FX Market Commentary 18.12.2020 What was the point in BOJ meeting overnight? Finally extensions of the handouts coming from the Japanese base, and remarkably the 103.0x was rescued via lack of conviction from macro players to chase it lower. Buyers now can play the break, undoing their opponents work and imagine the test of 105 as being important for the yearly close flows. This iteration of dollar strength will be most visible in GBPUSD and USDJPY - choppy conditions seem appropriate. Here we are tracking this rather technical move. I am looking firstly for a move towards 105 resistance, followed by a zag to fade back towards 103.5x which is a 300 tick round trip. Thanks as usual for keeping the feedback coming 👍 or 👎
Long
by ridethepig
1
Gold finding a floor - finally?📌 @ridethepig Gold Market Commentary 16.12.2020 The moves in Gold have been excellent to track this year because of the tendency to put turning points around the Central Banks. This of course seems very appropriate. The 'infamous' loading zone has allowed us to pick the low hanging fruit, now things are going to start getting a bit trickier from a positioning perspective. I am certainly holding longs and will become a player of the momentum break today above $1,875. How far Fed is from reality and certainly equity markets too is remarkable, carrying out a quick review of the flows we are way out of the $1,803 support which is the one we were tracking earlier in the year. In any case, it is clear that the direction is long and with the Fed support essential - we should not suffer in the least. Buyers are aiming for $1,960 and $2,075 extension targets. Thanks as usual for keeping the feedback coming 👍 or 👎
FOREXCOM:XAUUSDLong
by ridethepig
23
ridethepig | CHF for the Yearly Close📌 CHF for the Yearly Close An excellent swing move, which is extraordinarily difficult to spot. You should note that what has played out has been completely carefully controlled and exclusively on the FED side. Whereas SNB have been seeking salvation against the inflows, the USD cycle is playing out by default and monetary error more than anything else. You cannot solve a monetary issue with private debt by issuing more private debt. As we know, the flows which have dealt considerable damage to buyers can constitute a good criteria for the evaluation of the next pivot level in play at 0.870x. There is no way to avoid the test, buyers need to be careful not to get hemmed in as a breach will threaten a -10% sweep which is what I am eyeballing for 2021. Switzerland will act as a suitable haven; SNB will threaten to gain time but only making the breakthrough harder in my opinion. Not the most technical of charts...shows the levels we need to exploit and when broken, advance the units and swing the bat. Thanks as usual for keeping the feedback coming 👍 or 👎
Short
by ridethepig
ridethepig | Aussie for the Yearly Close📌 AUD for the Yearly Close It seems a good choice of the moment to also progress with the Commodity Currencies next, the characteristic of the next macro themes are going to be coming from shortages on supply side and we can dissect how to configure that into currencies and in accordance with the previous diagrams. AUD has freed some space above for the coming months and quarters, the 0.813x initial target is interesting to note how the opportunity for capitulation of sellers arises, the breach will unlock the 'inverse' of a waterfall concept that we are now discussing in USD; With enormous complications for commodities coming, after a few more mistakes from politicians, AUD will be one of the main winners in the moves. In the next flows, 0.950x and 1.097x are clear extensions but until we can crack through the 0.813x soft resistance are only considered skeletons in the closet for now. Thanks as usual for keeping the feedback coming 👍or 👎
Long
by ridethepig
4
ridethepig | Dollar for the Yearly Close📌 Dollar for the Yearly Close Now comes the dollar complex which we have covered several times - the artificial devaluation which we were tracking in 2019 has arisen: Dollar bears now have a good position, because it is looking highly unlikely that Trump can pull this off now and manage to force a stop to the artificial devaluation. This somewhat clumsy move of a Biden/Harris WhiteHouse alongside a GA senate flip which looks cooked to come in January - will expose badly the USD and nothing will be able to prevent it from hanging on. The struggle to control a private debt problem by issuing more private debt is a serious mode for the birds. ...Monetary policy, or better said, Keynesian economics has the difficult task of proving its worth now: For USD the chance of setting up a counter attack of the highs is diminishing on all wings. As we are seeing, frequently the 90.0x handle has been difficult to crack, so it is clear that we need to pay attention to a breakdown here as it unlocks the possible momentum force towards the nearest support at 77.8x. Another extremely violent example of capital outflows looks around the corner for the U.S in 2021. Thanks as usual for keeping the feedback coming 👍 or 👎
TVC:DXYShort
by ridethepig
6
ridethepig | CHF Market Commentary 03.12.2020Another interesting play where buyers can win the flow. So, the idea to outguess a temporary floor in USDCHF is correct as we are approach very 'rich' levels for sellers. If buyers are going to have a late breakfast 0.890x is the level to load. Another few pips down and it would be difficult to defend because of the horizontal support. For those that remember the previous attempt we are tracking exactly the same attack. As we all know, the philosophy of a minor swing, is only for the evaluation of any possible situation with the major swing involved. And for this particularly we have the next leg higher in dollar cooking with some devaluation from SNB to put the icing on the cake: An interesting move, EURCHF ⬆️ and USDCHF ⬆️ up a lot more... The flow is worth considering, it is not a pitless market, very often we can close our eye to some dollar devaluation but we sellers are out of energy and we need to smooth things over. Thanks for keeping the feedback coming 👍 or 👎
Long
by ridethepig
5
ridethepig | NFP PlayNFP is threatening the breakdown in EURUSD and across G10 pairs. The flows, with centralisation focused on the dollar follow profit taking and an early advance. This can be exploited and is easy to understand what is in play (as with NZDUSD). We have our shelter at 1.215x which is our ceiling, the next step is to look for areas of value to the downside. In a classical price action style, support regions are suitable targets at 1.211x and 1.200x. This will be met with demand; macro position building. More an anyone else, you will all know how bullish we were on euro ahead of the crowd. We are back above those highs after the breakthrough and with claims ticking down we are in time for payrolls, it is harder to play the buy side this time as we are already extended and at rich levels. The idea is of course an attempt to ride a retracement on the NFP headline. Lets see how it goes.
Short
by ridethepig
15
ridethepig | NZD Chart of the WeekThis chart update comes after the conversation with @YIQI.... We are tracking how the following elegant defence can hold a breakup through, namely the main target in NZ 10Y Yields: For those who remember, the sweep and breakup was what we had our eye on. A move from 50bps to 100bps was very fancy! And now we have for ourselves a change of scenery! The previous flow must unwind, and in plan of their new attack we can ride the profit taking. Sharp sellers are itching to attack, 0.705x should be able to hold, I am in full sized positions. Thanks for keeping the feedback coming 👍or 👎
Short
by ridethepig
8