The coming week of Aug. 13, 2018, sets up trending pivot math concurrent with narrow ranges (means breakouts) in the S&P 500 (countertrend bounce & maybe down), Japanese yen, Crude oil, and gold (extreme narrow range block/rectangle on daily chart). The Eurodollar has already made 5 easily-countable down-waves (Monthly chart) since the swing top I identified in advance months ago, and it has sideways pivots for this week but extreme trending monthly pivots into Sept.
The week of Aug. 6 presents the start of a massive crude oil price move. It also offers weekly and monthly trending pivots in the Japanese yen, near weekly-chart lows. The Eurodollar has higher monthly pivots overlapping last month’s pivots, forming a range break setup in trending pivot math for the next four weeks and on the monthly camarilla low-reversal pivots. Additional Euro supports include the monthly 20-period and 50-period moving averages.
The U.S. dollar fell on Friday after the U.S. Non-farm payrolls (NFP) came in below expectations with only a gain of 157,000, but otherwise the unemployment rate dropped to 3.9% and wage growth remained unchanged at 0.3%.
The U.S. dollar is mixed on Friday against major pairs. The U.S. economy grew at a 4.1% pace on the second quarter according to the first estimate. The number came in right on the forecast which had no positive effect for the U.S. dollar, but it did validate the U.S. Federal Reserve decision to keep a tighter monetary policy with two more rate hikes in the horizon this year.
The week of July 30 presents breakout traders gold, Eurodollar and crude oil setups. All three are in narrow ranges on multiple time frames with inside-range pivots, compared to this week. Monthly pivots are also inside-range on the Eurodollar and crude oil, making this a time-pivots breakout as well. If one considers the last 10 days’ range as a time series, then half of its length could be rotated upwards/downwards in the price axis (use your finger’s distal phalanx for past 5-6 days and rotate 90-degrees up/down) to give a $71.00/barrel or $66.00/barrel target as a rough estimate that may seem today like a crazy place for price to be.
The week of July 23 will likely continue the “low-reversals-consolidations” theme of the prior week (July 16-20). The swing low of gold is in/here, in my opinion (see chart grid below). Do not initiate gold short side positions. Soybeans with a bearish daily & bullish weekly chart and Bitcoin with a 3-Day & Daily Chart sell signal may be the exceptions. Anyone ready to try and catch a falling safe or learn how? Now, it’s a savage sober rave party! This is some serious technical analysis regarding how to identify reversals and invert charts (as in upside down).
Last week at this time we were working on a high that hit at the beginning of the window and, indeed, patterns started to roll over. NFLX had a terrible earnings report and got crushed in the aftermarket last Monday night. That’s fair enough. But on Tuesday it put in what is called a bullish belt hold. That’s where it gaps down but the end of the gap turns out to be the low for the day. Lots of stocks put in green bars that day. In terms of psychology, bears had to wonder if they’d ever get a break.
The U.S. dollar fell against major pairs on Friday after U.S. President Donald Trump tweeted that China and the European Union manipulate their currencies. Trade war escalation has reached the second phase at a time when American politics are having an identity crisis with the ongoing Russian interference during the 2016 elections. Steven Mnuchin will head to Buenos Aires to take part in the finance ministers G20 meeting with trade and monetary policies sure to be a topic of discussion.
Have we reached the zero hour? Time windows don’t have to validate although much of the time they do. I can tell you one thing, we have a very interesting news event at day 610 off the February 2016 bottom. U.S. President Donald Trump and Russian president Vladimir Putin are meeting as I’m writing this. In any era, when the two superpowers meet face to face it’s a big deal. Given everything, we’ve been through the past couple of years its an even bigger deal.
The U.S. dollar was higher across the board against major pairs on Friday. Trade war concerns rose heading into the weekend and the comments from U.S. President Donald Trump during the week sparked a rally of USD buying. Trump has been outspoken on NATO, trade and the Brexit deal while economic indicators and the US Fed have been supportive of the greenback.