Filed Under:
Talking Points

  • USD/JPY holding below key pivot
  • USD/CAD testing year’s closing high
  • SPX on verge of important break
Unfamiliar with Gann Square Root Relationships? Learn more about them here.

Foreign Exchange Price & Time at a Glance:

Price & Time Analysis: USD/JPY

PT_FEB_21_body_Picture_3.png, Price & Time: Give Me A BreakCharts Created using Marketscope – Prepared by Kristian Kerr

  • USD/JPY remains in consolidation mode above the 4th square root relationship of the year’s high near 101.35
  • Our near-term trend bias is higher while 101.35 holds
  • The 2nd square root relationship of the year’s low at 102.75 is a major hurdle that needs to be overcome soon if a more important move higher in the rate is to take hold
  • The middle of next week is a medium-term cycle turn window
  • A daily close below 101.35 would turn us negative on the exchange rate
USD/JPY Strategy: Square for the moment. Awaiting a break of 102.75.

Instrument

Support 2

Support 1

Spot

Resistance 1

Resistance 2

USD/JPY

*101.35

101.70

102.40

*102.75

103.10

Price & Time Analysis: USD/CAD

PT_FEB_21_body_Picture_2.png, Price & Time: Give Me A BreakCharts Created using Marketscope – Prepared by Kristian Kerr

  • USD/CAD reversed sharply off the 3rd square root relationship of the year’s high at 1.0910 durng an important cycle turn window
  • Our near-term trend bias is positive in Funds while over 1.0910
  • The 78.6% retracement of the January/February decline at 1.1155 is interim resistance ahead of the year’s high near 1.1225
  • A minor cycle turn window is seen around the middle of next week
  • Weakness below 1.1015 would raise concern, but only aggressive weakness below 1.0910 would invalidate the important cycle turn witnessed on Wednesday
USD/CAD Strategy: Like the long side while above 1.0910.

Instrument

Support 2

Support 1

Spot

Resistance 1

Resistance 2

USD/CAD

*1.1015

1.1060

1.1155

1.1155

*1.1225

Focus Chart of the Day: S&P 500

PT_FEB_21_body_Picture_1.png, Price & Time: Give Me A BreakA few months ago we pointed out that the the period between January 24th and the first week of February would be cyclically significant for the S&P 500. Interestingly the start of this period saw the index come under steady pressure while the end of it saw an important low recorded. Our view remains the same. A break of either of these range extremes should be significant for the index and not just for the obvious price implications, but also for time ones. A move to new all-time highs will remove a major time barrier. This would set the stage for a push higher into the next important turn window next month and probably into 3Q14. A failure, on the other hand, in the index to punch through to new highs followed by a turn lower back under this month’s low would signal an important change in behavior and remove a major level of “time support”. With the SPX so close to new highs this latter scenario is obviously very unlikely, but worth being aware of as the index flirts with 1850.



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