Filed Under:
Talking Points

  • Kiwi enters into medium-term cycle turn window
  • USD/JPY remains in consolidation mode
  • GBP/USD pulls back from key Fibo
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Focus Chart of the Day: NZD/USD

PT_Kiwi_body_Picture_4.png, Price & Time: Cyclical Curveball in the Kiwi The next couple of days are a clear medium-term cycle turn window in NZD/USD. Given the impressive 6 big figure plus rally in the Kiwi this month we had expected the window to lead to a top and indeed it may have. However, Tuesday’s early weakness has thrown us a bit of a curveball as there is now a chance the exchange rate peaked early or may even record a low. The 2nd square root progression of the recent high at .8250 is important in this regard as a close under this level would be clear evidence of an early change in trend.

Foreign Exchange Price & Time at a Glance:

Price & Time Analysis: USD/JPY

PT_Kiwi_body_Picture_3.png, Price & Time: Cyclical Curveball in the Kiwi Charts Created using Marketscope – Prepared by Kristian Kerr

  • USD/JPY is in consolidation mode just above the 1x1 Gann angle line of the year’s high in the 98.70 area
  • While above the 1x1 Gann angle line of the February low at 97.80 our near-term trend bias will remain higher
  • The 4th square root progression of the year’s high at 99.65 is a clear near-term pivot with traction above needed to set up a push to attractions at 100.70 and above
  • A very minor cycle turn window is seen later this week
  • Weakness below 98.70 would dampen the positive tone, but only a move under 97.80 on a closing basis would turn us negative on the exchange rate
USD/JPY Strategy: Like the long side while over 97.80.

Instrument

Support 2

Support 1

Spot

Resistance 1

Resistance 2

USD/JPY

*97.80

98.70

98.80

99.00

*99.65

Price & Time Analysis: GBP/USD

PT_Kiwi_body_Picture_2.png, Price & Time: Cyclical Curveball in the Kiwi Charts Created using Marketscope – Prepared by Kristian Kerr

  • GBP/USD failed last week near the 88.6% retracement of the year’s range near 1.6165.
  • While above a key Gann confluence near 1.5895 our near-term trend bias will remain higher in Cable
  • While the 1.6090 area is resistance, strength over 1.6165 is really neeeded to signal a resumption of the broader uptrend
  • The middle of the week is a possible minor cycle turn window
  • A daily close below 1.5895 would undermine the positive tone in the rate and turn us negative
GBP/USD Strategy: Like the long side whilst over 1.5895.

Instrument

Support 2

Support 1

Spot

Resistance 1

Resistance 2

GBP/USD

*1.5895

1.5960

1.5980

1.6090

*1.6165

Price & Time Analysis: S&P 500

PT_Kiwi_body_Picture_1.png, Price & Time: Cyclical Curveball in the Kiwi Charts Created using Marketscope – Prepared by Kristian Kerr

  • S&P 500 failed last week during a medium-term cycle turn window at a key Fibonacci projection level at 1735
  • However, the close over 1710 has shifted our trend bias higher and while above 1675 it will remain positive
  • The 1635 projection level is a natural upside pivot with traction above needed to signal a trend continuation
  • A minor cycle turn window is seen over the second half of the week
  • A daily close below 1675 would suggest a more important reversal has occurred in the S&P 500
S&P 500 Strategy: Like buying into weakness over the next couple of days.

Instrument

Support 2

Support 1

Spot

Resistance 1

Resistance 2

S&P 500

*1675

1690

1699

1710

*1735

--- Written by Kristian Kerr, Senior Currency Strategist for DailyFX.com

This publication attempts to further explore the concept that mass movements of human psychology, as represented by the financial markets, are subject to the mathematical laws of nature and through the use of various geometric, arithmetic, statistical and cyclical techniques a better understanding of markets and their corresponding movements can be achieved

Looking for a way to pinpoint sentiment extremes in SPX in real time? Try the Speculative Sentiment Index.

To contact Kristian, e-mail kkerr@fxcm.com. Follow me on Twitter @KKerrFX

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