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Weekly FX Roundup
It was a down week for the dollar. The Dollar Index fell 1.5 to 76.235. The index is just shy of the upside target of 78.36. Downside objective is the index low of 74.66. If that support were to break, it would signal a new trend lower.
As I posted last week several dollar pairs were up against support/resistances. All of those pairs listed bounced off those levels signaling a continued weak dollar.
RSI saw long grid trigger in the GBP.USD, GBP.CHF and short grid triggers in the CAD/JPY, EUR/GBP, USD/JPY, gold.
Notable Chart Patterns:
Gold: Last week we posted that the market has been consolidating and forming a symmetrical triangle. A breakout in either direction should signal major trend in the direction of breakout. That breakout occurred to the upside this week. Expect market to take out overhead resistance and continue the rally higher.
CHF.JPY: Last week we posted that the market is in a narrow channel since early November. Channel is 99.5 on top side and 97.5 on the bottom side. A breakout out from this channel should signal a major trend in the direction of the breakout. Last week we saw the breakout higher. Expect the market to continue a rally into overhead resistance.
EUR.AUD: Last week we posted that the market is creating a descending triangle which is bearish. Watch for breakout lower past 1.65. Unfortunately for the bears the market has broken out of the bearish patter higher. If overhead resistance is taken out, the signal would be nullified.
GBP.CHF: Last week we posted the market has created a double top @ 2.336. Watch for confirmation of signal with a break of support lower @ 2.27. This week saw the market confirm the bearish double top. The market is now in a downtrend and should continue lower into support. The 1-2-3 bottom we posted last week has been taken out by the lower trade.
GBP.JPY: Market has a triple bottom established around 220.8.
NZD.USD: Narrow channel. Top of the channel at .788 bottom of the channel at .743. A break of this channel should signal a major trend in the direction of breakout.
STRATEGIES-------
Please note: The support and resistances noted below should be considered general areas of support and resistance and not exact figures. Support and resistance areas may range several ticks up or down from what is noted.
The noted objectives are usually 50% corrections.
AUD.USD
Strategies----
50ma: Weakening downtrend with 5ma now above the 10ma. Market remains in bearish posture below the 50ma. Strategy suggests limited buying under 50ma.
RSI (14) Grid: RSI is 54.19% suggests standing aside.
Support/Resistance: Nearest resistance is .89 then .9397. Nearest support is .8578 then .8363.
Downside objective is .8405. Upside Objective is .899.
Notes: Market appears to be directionless. RSI shows no trend. Nearest support is not significant. Overhead resistance is significant and could be formidable against any rally attempt above.
EUR.USD
Strategies----
50ma: Strong uptrend with 5ma now above the 10ma. Market now is in bullish posture above the 50ma. Strategy suggests buying above 50ma.
RSI (14) Grid: Market @ RSI 64.32% suggests standing aside but very close to sell trigger.
Support/Resistance: Nearest support is 1.453 then 1.4292. Last week’s nearest resistance was taken out. The new closest resistance is 1.4745 then most recent high of 1.496.
Downside objective is 1.415. Last week’s upside objective of 1.464 was met. New upside objective is market high of 1.4965.
Notes: Overhead resistance is significant as it is the top of the shoulder in the head and shoulder pattern. Taking out that resistance would nullify that pattern. Market is currently on that resistance so this is a pivotal point in the trade. My bias is lower, but let’s see if we can take out the resistance. RSI downtrend was taken out last week adding to the bullish rally. The market had a small downtrend going but was also taken out going higher this week.
USD.CHF
Strategies---
50ma: Strong downtrend with 5ma now below the 10ma. Market remains in bearish posture below the 50ma. Strategy suggests aggressive selling below 50ma.
RSI Grid: Market is in neutral territory now at RSI 35.66%. Strategy suggests standing aside but very close to long trigger.
Support/Resistance: Nearest resistance is 1.1613 then most recent high of 1.1860. Nearest support is 1.088 the most recent low.
Downside objective is 1.1236. Upside objective is 1.1680.
Notes: Last week market rallied up to resistance and then reversed like so many dollar pairs. RSI uptrend was taken out last week. The area of resistance also happened to be the downtrend line. The overall downtrend continues.
GBP.USD
Strategies---
50ma: Strong downtrend with 5ma below the 10ma. Market is in a bearish posture below 50ma. Strategy suggests aggressive selling below 50ma.
RSI Grid: RSI is 39.3% suggests standing aside, but very close to long triggers.
Support/Resistance: Nearest resistance is 2.0249 then 2.0547. Nearest support is 1.967 then 1.9172.
Downside objective is 1.9172. Upside objective is 2.011.
Notes: Last week’s nearest resistance was taken out. The next two resistance areas are formidable against any rally. On the other hand the market hit solid resistance of 1.967 and reversed higher. Support is formidable as well. A breakout in either direction past either support or resistance would signal a pretty major trend. RSI is trending lower but looks like it wants to take out the downtrend line. My bias is bullish to the nearest resistance. The overall downtrend continues.
USD.JPY
Strategies—
50ma: Strong uptrend with 5ma above 10ma. Market is in bullish posture above 50ma. Strategy suggests aggressive buying above 50ma.
RSI Grid: Market is in neutral territory now at RSI 47.3%. Strategy suggests standing aside.
Support/Resistance: Nearest resistance is113.9 then the most recent high of 115.98. Nearest support is last market low of 107.26.
Downside objective is 110.57. Upside objective is 115.4.
Notes: Market rallied into resistance and went lower. That area happens to be right on the downtrend line. It looks like the market is having a tough time taking out that area going higher. RSI has broken uptrend.
USD.CAD
Strategies---
50ma: Strong downtrend with 5ma below the 10ma. Market is in bearish posture now below the 50ma. Strategy suggests aggressive selling below the 50ma.
RSI Grid: Market shows no bias now at RSI 33.65. Strategy suggests standing aside but very close to long trigger.
Support/Resistance: Nearest resistance is 1.034 then most recent high of 1.086. Nearest support is most recent low of .911.
Downside objective is .9653. Upside objective is 1.0463.
Notes: This is another one of those dollar pairs that went to resistance and the established downtrend then reversed. So the overall downtrend continues.
NZD.USD
Strategies---
50ma: Strong uptrend with 5ma now above the 10ma. Market is now in bullish posture above the 50ma. Strategy suggests aggressive buying above the 50ma.
RSI Grid: Market shows no bias now at RSI 59.08.
Support/Resistance: Nearest resistance is most recent high of .7877 then .8103. Nearest support is .7426 then .6795.
Downside objective is .7276. Upside objective is .7871.
Notes: This market is one of the few examples that the 50ma strategy doesn’t work 100% of the time. The market has been in somewhat of a channel since October. It’s very difficult for the 50ma strategy to profit from a market in a narrow channel. The strategy really shines with long trends. Until we get that breakout and long trend, expect the 50ma to aggressively sell one week and switch to an aggressive buy the next.
GOLD
Strategies----
50ma: Strong uptrend with 5ma above the 10ma. Market remains in bullish posture above the 50ma. Strategy suggests aggressive buying above the 50ma.
RSI Grid: RSI is 70.3%. Market has triggered the short grid.
Support/Resistance: Nearest resistance is 845.38 the most recent high.. Nearest support is 772.5.
Downside objective is 742.75. Upside objective is 845.38.
Notes: With a breakout of the triangle to the upside watch for a continued rally. A break of support and a new high would really put a lot of momentum with the bulls.
Sunday, December 30, 2007
Sunday, December 23, 2007
Weekly FX Roundup
Weekly FX Roundup
Yet another strong week for the Dollar as the index closed up .3 from last week. If you follow the 50ma strategy with the weekly chart, the 5ma has now trended above the 10ma. This indicates a weakening downtrend. The question now is this a correction or the beginning of a new uptrend? Expect continued rally into resistance 78.425 and then 82.03. Looking at some of the individual dollar pairs I see the next few weeks being somewhat important for the dollar bulls. The EUR, CHF, GBP, JPY, CAD, and the AUD are all up against resistance for the dollar rally. If we see these resistances taken out by the dollar rally, the tides of change and a strong rally just might be underway.
Next week will be fairly limited because of Christmas and New Years.
RSI saw long grid trigger in the GBP.USD and short grid triggers in the USD/CHF.
Notable Chart Patterns:
Gold: Market consolidation forming a symmetrical triangle. Breakout in either direction should signal major trend in direction of breakout. 1-2-3 top is intact watch for confirmation of signal which would be lower.
CHF.JPY: Market is in a narrow channel since early November. Channel is 99.5 on top side and 97.5 on the bottom side. A breakout out from this channel should signal a major trend in the direction of the breakout.
EUR.AUD: Market is creating a descending triangle which is bearish. Watch for breakout lower past 1.65.
GBP.CHF: Market has created a double top @ 2.336. Watch for confirmation of signal with a break of support lower @ 2.27. A conflicting signal yet still valid is a possible 1-2-3 bottom. A confirmation of this bullish signal would be a rally past the #2 point which is 2.34.
GBP.JPY: Market has a triple bottom established around 220.8.
STRATEGIES-------
Please note: The support and resistances noted below should be considered general areas of support and resistance and not exact figures. Support and resistance areas may range several ticks up or down from what is noted.
The noted objectives are usually 50% corrections.
AUD.USD
Strategies----
50ma: Strong downtrend with 5ma below 10ma. Market remains in bearish posture below the 50ma. Strategy suggests aggressive selling under 50ma.
RSI (14) Grid: RSI is 44.96% suggests standing aside.
Support/Resistance: Nearest resistance is .89 then .9397. Nearest support is .8578 then .8363.
Downside objective is .8363. Upside Objective is .899.
EUR.USD
Strategies----
50ma: Strong downtrend with 5ma below the 10ma. Market remains in bearish posture below the 50ma. Strategy suggests aggressive selling below 50ma.
RSI (14) Grid: Market @ RSI 36.33 suggests standing aside but very close to long trigger.
Support/Resistance: Nearest support is 1.4292 then 1.3847. Nearest resistance is 1.453 then most recent high of 1.496.
Downside objective is 1.415. Upside objective is 1.464.
USD.CHF
Strategies---
50ma: Strong uptrend with 5ma above the 10ma. Market remains in bullish posture above the 50ma. Strategy suggests aggressive buying above 50ma.
RSI Grid: Market is in neutral territory now at RSI 67.97. Strategy suggests standing aside but very close to short trigger.
Support/Resistance: Nearest resistance is 1.1613 then most recent high of 1.1860. Nearest support is 1.088 the most recent low.
Downside objective is 1.1236. Upside objective is 1.1680.
GBP.USD
Strategies---
50ma: Strong downtrend with 5ma below the 10ma. Market is in a bearish posture below 50ma. Strategy suggests aggressive selling below 50ma.
RSI Grid: RSI is 27.25 and oversold and has triggered the long grid.
Support/Resistance: Nearest resistance is 1.9921 then 2.0214. Nearest support is 1.967 then 1.9411.
Downside objective is 1.9202. Upside objective is 2.011.
USD.JPY
Strategies—
50ma: Strong uptrend with 5ma above 10ma. Market is in bullish posture above 50ma. Strategy suggests aggressive buying above 50ma.
RSI Grid: Market is in neutral territory now at RSI 69.18. Strategy suggests standing aside but very close to short trigger.
Support/Resistance: Nearest resistance is 113.98 then the most recent high of 115.98. Nearest support is last market low of 107.21.
Downside objective is 110.57. Upside objective is 115.4.
USD.CAD
Strategies---
50ma: Weakening uptrend with 5ma now below the 10ma. Market remains in bullish posture above the 50ma. Strategy suggests limited selling above the 50ma.
RSI Grid: Market shows no bias now at RSI 41.46. Strategy suggests standing aside.
Support/Resistance: Nearest resistance is 1.034 then most recent high of 1.086. Nearest support is most recent low of .911.
Downside objective is .9653. Upside objective is 1.0463.
NZD.USD
Strategies---
50ma: Strong downtrend with 5ma now below the 10ma. Market is now in bearish posture below the 50ma. Strategy suggests aggressive selling below the 50ma.
RSI Grid: Market shows no bias now at RSI 47.8. Stand aside.
Support/Resistance: Nearest resistance is most recent high of .7877 then .8103. Nearest support is .7426 then .6795.
Downside objective is .7276. Upside objective is .7731.
GOLD
Strategies----
50ma: Strong uptrend with 5ma above the 10ma. Market remains in bullish posture above the 50ma. Strategy suggests aggressive buying above the 50ma.
RSI Grid: Market shows no bias now at RSI 55.56. Strategy suggests standing aside.
Support/Resistance: Nearest resistance is 836.6. Nearest support is 772.5.
Downside objective is 742.75. Upside objective is 845.38.
Yet another strong week for the Dollar as the index closed up .3 from last week. If you follow the 50ma strategy with the weekly chart, the 5ma has now trended above the 10ma. This indicates a weakening downtrend. The question now is this a correction or the beginning of a new uptrend? Expect continued rally into resistance 78.425 and then 82.03. Looking at some of the individual dollar pairs I see the next few weeks being somewhat important for the dollar bulls. The EUR, CHF, GBP, JPY, CAD, and the AUD are all up against resistance for the dollar rally. If we see these resistances taken out by the dollar rally, the tides of change and a strong rally just might be underway.
Next week will be fairly limited because of Christmas and New Years.
RSI saw long grid trigger in the GBP.USD and short grid triggers in the USD/CHF.
Notable Chart Patterns:
Gold: Market consolidation forming a symmetrical triangle. Breakout in either direction should signal major trend in direction of breakout. 1-2-3 top is intact watch for confirmation of signal which would be lower.
CHF.JPY: Market is in a narrow channel since early November. Channel is 99.5 on top side and 97.5 on the bottom side. A breakout out from this channel should signal a major trend in the direction of the breakout.
EUR.AUD: Market is creating a descending triangle which is bearish. Watch for breakout lower past 1.65.
GBP.CHF: Market has created a double top @ 2.336. Watch for confirmation of signal with a break of support lower @ 2.27. A conflicting signal yet still valid is a possible 1-2-3 bottom. A confirmation of this bullish signal would be a rally past the #2 point which is 2.34.
GBP.JPY: Market has a triple bottom established around 220.8.
STRATEGIES-------
Please note: The support and resistances noted below should be considered general areas of support and resistance and not exact figures. Support and resistance areas may range several ticks up or down from what is noted.
The noted objectives are usually 50% corrections.
AUD.USD
Strategies----
50ma: Strong downtrend with 5ma below 10ma. Market remains in bearish posture below the 50ma. Strategy suggests aggressive selling under 50ma.
RSI (14) Grid: RSI is 44.96% suggests standing aside.
Support/Resistance: Nearest resistance is .89 then .9397. Nearest support is .8578 then .8363.
Downside objective is .8363. Upside Objective is .899.
EUR.USD
Strategies----
50ma: Strong downtrend with 5ma below the 10ma. Market remains in bearish posture below the 50ma. Strategy suggests aggressive selling below 50ma.
RSI (14) Grid: Market @ RSI 36.33 suggests standing aside but very close to long trigger.
Support/Resistance: Nearest support is 1.4292 then 1.3847. Nearest resistance is 1.453 then most recent high of 1.496.
Downside objective is 1.415. Upside objective is 1.464.
USD.CHF
Strategies---
50ma: Strong uptrend with 5ma above the 10ma. Market remains in bullish posture above the 50ma. Strategy suggests aggressive buying above 50ma.
RSI Grid: Market is in neutral territory now at RSI 67.97. Strategy suggests standing aside but very close to short trigger.
Support/Resistance: Nearest resistance is 1.1613 then most recent high of 1.1860. Nearest support is 1.088 the most recent low.
Downside objective is 1.1236. Upside objective is 1.1680.
GBP.USD
Strategies---
50ma: Strong downtrend with 5ma below the 10ma. Market is in a bearish posture below 50ma. Strategy suggests aggressive selling below 50ma.
RSI Grid: RSI is 27.25 and oversold and has triggered the long grid.
Support/Resistance: Nearest resistance is 1.9921 then 2.0214. Nearest support is 1.967 then 1.9411.
Downside objective is 1.9202. Upside objective is 2.011.
USD.JPY
Strategies—
50ma: Strong uptrend with 5ma above 10ma. Market is in bullish posture above 50ma. Strategy suggests aggressive buying above 50ma.
RSI Grid: Market is in neutral territory now at RSI 69.18. Strategy suggests standing aside but very close to short trigger.
Support/Resistance: Nearest resistance is 113.98 then the most recent high of 115.98. Nearest support is last market low of 107.21.
Downside objective is 110.57. Upside objective is 115.4.
USD.CAD
Strategies---
50ma: Weakening uptrend with 5ma now below the 10ma. Market remains in bullish posture above the 50ma. Strategy suggests limited selling above the 50ma.
RSI Grid: Market shows no bias now at RSI 41.46. Strategy suggests standing aside.
Support/Resistance: Nearest resistance is 1.034 then most recent high of 1.086. Nearest support is most recent low of .911.
Downside objective is .9653. Upside objective is 1.0463.
NZD.USD
Strategies---
50ma: Strong downtrend with 5ma now below the 10ma. Market is now in bearish posture below the 50ma. Strategy suggests aggressive selling below the 50ma.
RSI Grid: Market shows no bias now at RSI 47.8. Stand aside.
Support/Resistance: Nearest resistance is most recent high of .7877 then .8103. Nearest support is .7426 then .6795.
Downside objective is .7276. Upside objective is .7731.
GOLD
Strategies----
50ma: Strong uptrend with 5ma above the 10ma. Market remains in bullish posture above the 50ma. Strategy suggests aggressive buying above the 50ma.
RSI Grid: Market shows no bias now at RSI 55.56. Strategy suggests standing aside.
Support/Resistance: Nearest resistance is 836.6. Nearest support is 772.5.
Downside objective is 742.75. Upside objective is 845.38.
Monday, December 17, 2007
Corn-Bean Basis
Just a few fundamental thoughts here. With the latest USDA supply and demand numbers coming out last week, I think fundamentals have painted a pretty bullish picture for beans. Stocks to use ratio is now at 6.2% which is a very tight supply. If you plug the numbers in the Grandmill formula you come up with a fair value range of 1501 to 1068 for old crop! Is this the year beans will be in the teens? I think it might be. Looking at the basis chart below you can see an improving basis. Why is this significant? It is very rare to see a large basis improvement along with a large futures rally. If end users are willing to bid up the cash against futures in the face of the present rally, there is only one direction this market can go. Straight up! As a hedger I'm looking at protecting the upside either with calls or buying futures. I know call option prices are through the roof, but it may pay dividends in the end.
The same is true for corn, but not nearly as bullish as beans. We are seeing a pretty big rally in futures along with basis improvement. As long as we see this trend continue, bull spreading the market is a pretty good idea (long old crop short new crop). Stocks/Use ratio at 14.6% suggests an adequate supply. Because of the supply issue, I believe the current trend (basis improvement & futures rally) is limited and should give way to a pretty big reversal. That will either be a basis crash or futures decline. If basis starts to weaken, it will be more profitable to sell cash rather than futures. If basis remains firm, it will be more profitable to sell futures than cash.
The same is true for corn, but not nearly as bullish as beans. We are seeing a pretty big rally in futures along with basis improvement. As long as we see this trend continue, bull spreading the market is a pretty good idea (long old crop short new crop). Stocks/Use ratio at 14.6% suggests an adequate supply. Because of the supply issue, I believe the current trend (basis improvement & futures rally) is limited and should give way to a pretty big reversal. That will either be a basis crash or futures decline. If basis starts to weaken, it will be more profitable to sell cash rather than futures. If basis remains firm, it will be more profitable to sell futures than cash.
To sum it up, I like the bullish positions in these grains. Hedging this I would either lock in floors with puts and keep the cash. Or I would buy call options in hope that the market rallies to the strike of the call and sell cash. Either way I would certainly position to keep the top side open.
Saturday, December 15, 2007
Weekend FX Roundup
Weekly FX Roundup
This week was another fairly decent week for the Dollar. The Dollar index weekly settled at 76.34 up .17 from last week. The index is still in a pretty aggressive downtrend with no real good signal to justify longs yet. Just a correction to the 50% retracement mark would give us a figure of 83.57 which happens to be the market’s first significant resistance. That’s a pretty big “rally” if that occurs.
RSI saw long grid trigger in the AUD/NZD and short grid triggers in the USD/CAD. Both of those markets have come off their triggers.
Notable Chart Patterns:
Gold: Market consolidation forming a symmetrical triangle. Breakout in either direction should signal major trend in direction of breakout. 1-2-3 top is intact watch for confirmation of signal which would be lower.
CHF.JPY: Market is in a narrow channel since early November. Channel is 99.5 on top side and 97.5 on the bottom side. A breakout out from this channel should signal a major trend in the direction of the breakout.
AUD.USD: Market has broken lower past good support at 87ish. This should signal a new trend lower.
EUR.AUD: Market is creating a descending triangle which is bearish. Watch for breakout lower past 1.65.
EUR.USD: Market has broken lower past good support at 1.45. This should signal a new trend lower.
GBP.CHF: Market has created a 1-2-3 bottom. A confirmation of this bullish signal would be a rally past the #2 point which is 2.34.
GBP.USD: Loose head and shoulder top. Market has broken support. 1-2-3 top and head and shoulder top have been confirmed. Look for bearish trend to continue.
NZD.USD: Market has created a double top. Confirmation of the signal would be for a decline past .75.
STRATEGIES-------
AUD.USD
Strategies----
50ma: Strong downtrend with 5ma below 10ma. Market remains in bearish posture below the 50ma. Nearest resistance is .89. Nearest support is 50% retracement @ .85. Strategy suggests aggressive selling under 50ma.
RSI (14) Grid: RSI is 40.2 suggest standing aside.
EUR.USD
Strategies----
50ma: Strong downtrend with 5ma moving below the 10ma. Market is now in bearish posture below the 50ma. Nearest support is 50% retracement @ 1.42. Nearest resistance is most recent high of 1.496. Strategy suggests aggressive selling below 50ma.
RSI (14) Grid: Market @ RSI 38.5 suggests standing aside.
USD.CHF
Strategies---
50ma: Strong uptrend with 5ma above the 10ma. Market is now in bullish posture above the 50ma. Nearest resistance is most recent high at 1.189. Nearest support is 1.12. Strategy suggests aggressive buying above 50ma.
RSI Grid: Market is in neutral territory now at RSI 65.4. Strategy suggests standing aside.
GBP.USD
Strategies---
50ma: Strong downtrend with 5ma below the 10ma. Market is in a bearish posture below 50ma. Nearest resistance is 2.057 the most recent high. Nearest support is 2.015. Strategy suggests aggressive selling below 50ma.
RSI Grid: Market shows no bias now at RSI 38.11. Strategy suggests standing aside.
USD.JPY
Strategies—
50ma: Strong uptrend with 5ma above 10ma. Market is now in bullish posture above 50ma. Nearest resistance is 115.91 the most recent high. Nearest support is last market low of 107.21. Strategy suggests aggressive buying above 50ma.
RSI Grid: Market is in neutral territory now at RSI 60. Strategy suggests standing aside.
USD.CAD
Strategies---
50ma: Strong uptrend with 5ma above the 10ma. Market remains in bullish posture above the 50ma. Nearest resistance is 1.086 the most recent high. Nearest support is now 50% correction at .966. Strategy suggests aggressive buying above the 50ma. RSI Grid: Market shows no bias now at RSI 63. Strategy suggests standing aside.
NZD.USD
Strategies---
50ma: Strong uptrend with 5ma above the 10ma. Market remains in bullish posture above the 50ma. Nearest resistance is .79. Nearest support is .7445. Strategy suggests aggressive buying above the 50ma.
RSI Grid: Market shows no bias now at RSI 48.5.
GOLD
Strategies: Strong uptrend with 5ma above the 10ma. Market remains in bullish posture above the 50ma. Nearest resistance is 836.6. Nearest support is 779.7. Strategy suggests aggressive buying above the 50ma.
RSI Grid: Market shows no bias now at RSI 49.0. Strategy suggests standing aside.
This week was another fairly decent week for the Dollar. The Dollar index weekly settled at 76.34 up .17 from last week. The index is still in a pretty aggressive downtrend with no real good signal to justify longs yet. Just a correction to the 50% retracement mark would give us a figure of 83.57 which happens to be the market’s first significant resistance. That’s a pretty big “rally” if that occurs.
RSI saw long grid trigger in the AUD/NZD and short grid triggers in the USD/CAD. Both of those markets have come off their triggers.
Notable Chart Patterns:
Gold: Market consolidation forming a symmetrical triangle. Breakout in either direction should signal major trend in direction of breakout. 1-2-3 top is intact watch for confirmation of signal which would be lower.
CHF.JPY: Market is in a narrow channel since early November. Channel is 99.5 on top side and 97.5 on the bottom side. A breakout out from this channel should signal a major trend in the direction of the breakout.
AUD.USD: Market has broken lower past good support at 87ish. This should signal a new trend lower.
EUR.AUD: Market is creating a descending triangle which is bearish. Watch for breakout lower past 1.65.
EUR.USD: Market has broken lower past good support at 1.45. This should signal a new trend lower.
GBP.CHF: Market has created a 1-2-3 bottom. A confirmation of this bullish signal would be a rally past the #2 point which is 2.34.
GBP.USD: Loose head and shoulder top. Market has broken support. 1-2-3 top and head and shoulder top have been confirmed. Look for bearish trend to continue.
NZD.USD: Market has created a double top. Confirmation of the signal would be for a decline past .75.
STRATEGIES-------
AUD.USD
Strategies----
50ma: Strong downtrend with 5ma below 10ma. Market remains in bearish posture below the 50ma. Nearest resistance is .89. Nearest support is 50% retracement @ .85. Strategy suggests aggressive selling under 50ma.
RSI (14) Grid: RSI is 40.2 suggest standing aside.
EUR.USD
Strategies----
50ma: Strong downtrend with 5ma moving below the 10ma. Market is now in bearish posture below the 50ma. Nearest support is 50% retracement @ 1.42. Nearest resistance is most recent high of 1.496. Strategy suggests aggressive selling below 50ma.
RSI (14) Grid: Market @ RSI 38.5 suggests standing aside.
USD.CHF
Strategies---
50ma: Strong uptrend with 5ma above the 10ma. Market is now in bullish posture above the 50ma. Nearest resistance is most recent high at 1.189. Nearest support is 1.12. Strategy suggests aggressive buying above 50ma.
RSI Grid: Market is in neutral territory now at RSI 65.4. Strategy suggests standing aside.
GBP.USD
Strategies---
50ma: Strong downtrend with 5ma below the 10ma. Market is in a bearish posture below 50ma. Nearest resistance is 2.057 the most recent high. Nearest support is 2.015. Strategy suggests aggressive selling below 50ma.
RSI Grid: Market shows no bias now at RSI 38.11. Strategy suggests standing aside.
USD.JPY
Strategies—
50ma: Strong uptrend with 5ma above 10ma. Market is now in bullish posture above 50ma. Nearest resistance is 115.91 the most recent high. Nearest support is last market low of 107.21. Strategy suggests aggressive buying above 50ma.
RSI Grid: Market is in neutral territory now at RSI 60. Strategy suggests standing aside.
USD.CAD
Strategies---
50ma: Strong uptrend with 5ma above the 10ma. Market remains in bullish posture above the 50ma. Nearest resistance is 1.086 the most recent high. Nearest support is now 50% correction at .966. Strategy suggests aggressive buying above the 50ma. RSI Grid: Market shows no bias now at RSI 63. Strategy suggests standing aside.
NZD.USD
Strategies---
50ma: Strong uptrend with 5ma above the 10ma. Market remains in bullish posture above the 50ma. Nearest resistance is .79. Nearest support is .7445. Strategy suggests aggressive buying above the 50ma.
RSI Grid: Market shows no bias now at RSI 48.5.
GOLD
Strategies: Strong uptrend with 5ma above the 10ma. Market remains in bullish posture above the 50ma. Nearest resistance is 836.6. Nearest support is 779.7. Strategy suggests aggressive buying above the 50ma.
RSI Grid: Market shows no bias now at RSI 49.0. Strategy suggests standing aside.
Tuesday, December 11, 2007
USDA DEC S&D Report
Good Morning
The USDA Grain Supply and Demand Report is out today a little friendly for everything as usage is up sending ending stocks lower. If you're following spreads, the bull spreads (long old crop short new crop) ought to be in good shape for awhile. Here are the numbers:
All Wheat
Beg Stocks: 456
Production: 2067
Total Supply: 2613
Total Use: 2333 - raised from 2301 from last month
Ending Stocks: 280 - lowered from 312 last month
Stocks/Use: 12% (Very Tight)
Corn
Beg Stocks: 1304
Production: 13168
Total Supply: 14487
Total Use: 12690 - raised from 12590 last month
Ending Stocks: 1797 - lowered from 1897 last month
Stocks/Use: 14.16% normal supply
Beans
Beg Stocks: 573
Production: 2594
Total Supply: 3173
Total Use: 2988 - raised from 2963 last month
Ending Stocks: 185 - lowered from 210 last month
Stocks/Use 6.19% (very tight)
The USDA Grain Supply and Demand Report is out today a little friendly for everything as usage is up sending ending stocks lower. If you're following spreads, the bull spreads (long old crop short new crop) ought to be in good shape for awhile. Here are the numbers:
All Wheat
Beg Stocks: 456
Production: 2067
Total Supply: 2613
Total Use: 2333 - raised from 2301 from last month
Ending Stocks: 280 - lowered from 312 last month
Stocks/Use: 12% (Very Tight)
Corn
Beg Stocks: 1304
Production: 13168
Total Supply: 14487
Total Use: 12690 - raised from 12590 last month
Ending Stocks: 1797 - lowered from 1897 last month
Stocks/Use: 14.16% normal supply
Beans
Beg Stocks: 573
Production: 2594
Total Supply: 3173
Total Use: 2988 - raised from 2963 last month
Ending Stocks: 185 - lowered from 210 last month
Stocks/Use 6.19% (very tight)
Monday, December 10, 2007
Corn Spread to Watch
Here's a corn spread I think is a pretty good bet. Long Dec '08 (cz8) Short Jul '08 (cn8). Here's how I see it. Stocks to use ratio is at 15% which historically suggests an adequate supply. We have enough supply to meet demand into the next crop year. This will pressure any major rally in old crop contracts. On the other side of the trade, many farmers around the country are looking at increasing their bean plantings which will take acres away from corn. New crop contracts will have to compete for acres versus beans and wheat. This should help support new crop (cz8) corn. Target for this spread is 15-20 cents. Today, I started the buying at 5, and will look to add to positions every 10 cents lower. Full carry is around 21 cents for this spread! Adequate to large supplies should send this spread back to full carry.
Please note the Dec. crop report comes out tomorrow. A stocks to use ratio higher than 15% could start the charge higher in this spread whiled a S/U lower than 15% could give us an opportunity to add to positions.
Stay Tuned.....
Please note the Dec. crop report comes out tomorrow. A stocks to use ratio higher than 15% could start the charge higher in this spread whiled a S/U lower than 15% could give us an opportunity to add to positions.
Stay Tuned.....
Saturday, December 8, 2007
Weekly FX Roundup
Weekly FX Roundup
This week saw a steady to better trade in most of the major USD pairs. This week saw the pound move lower against the Dollar triggering aggressive selling in the 50ma strategy. This is a complete flip flop from the week before which was aggressively buying. Watch for a possible breakout lower in the GBP/USD pair. We are right near support and below the 50% correction. It could pick up steam with support being taken out.
RSI saw long grid trigger in the AUD/NZD and brief short grid triggers in the EUR/CAD and USD/CAD.
Notable Chart Patterns:
Gold: Market consolidation forming a symmetrical triangle. Breakout in either direction should signal major trend in direction of breakout. 1-2-3 top is intact watch for confirmation of signal which would be lower.
GBP/USD: Loose head and shoulder top. Market sitting on support. Watch for break lower. 1-2-3 top is confirmed with prices breaking lower past the #2 point.
USD/CAD: Market has rallied past 50% correction. Look for the uptrend to continue with minor setbacks.
AUD/NZD: Market has declined past the 50% correction. Look for the downtrend to continue with minor rally corrections.
AUD.USD
Strategies----50ma: Strong downtrend with 5ma below 10ma. Market is in bearish posture below the 50ma. Nearest resistance is market high of .937. Nearest support is 50% retracement @ .85. Strategy suggests aggressive selling under 50ma.
RSI (14) Grid: RSI is 45.17 suggest standing aside.
EUR.USD
Strategies----50ma: Weakening uptrend with 5ma moving below the 10ma. Market remains in bullish posture above the 50ma. Nearest support is 50% retracement @ 1.42. Nearest resistance is market high of 1.492. Strategy suggests limited selling above 50ma.
RSI (14) Grid: Market @ RSI 51.46 suggests standing aside.
USD.CHF
Strategies---50ma: Weakening downtrend with 5ma above the 10ma. Market remains is a bearish posture below 50ma. Nearest resistance is 50% correction at 1.141. Nearest support is 1.089. Strategy suggests limited buying below 50ma.
RSI Grid: Market is in neutral territory now at RSI 51.089. Strategy suggests standing aside.
GBP.USD
Strategies---50ma: Strong downtrend with 5ma below the 10ma. Market is in a bearish posture below 50ma. Nearest resistance is 2.083 the most recent high. Nearest support is 2.026. Strategy suggests aggressive selling above 50ma.
RSI Grid: Market shows no bias now at RSI 39.36. Strategy suggests standing aside.
USD.JPY
Strategies—50ma: Weakening downtrend with 5ma moving above 10ma. Market remains in bearish posture below 50ma. Nearest resistance is 112.75 the 50% correction. Nearest support is last market low of 107.21. Strategy suggests limited buying below 50ma.
RSI Grid: Market is in neutral territory now at RSI 49.78. Strategy suggests standing aside.
USD.CAD
Strategies---50ma: Strong uptrend with 5ma above the 10ma. Market remains in bullish posture above the 50ma. Nearest resistance is 1.085 the most recent high. Nearest support is recent low of .9056. Strategy suggests aggressive buying above the 50ma.
RSI Grid: Market shows no bias now at RSI 60.29. Strategy suggests standing aside.
NZD.USD
Strategies---50ma: Strong uptrend with 5ma above the 10ma. Market remains in bullish posture above the 50ma. Nearest resistance is .79. Nearest support is .7445. Strategy suggests aggressive buying above the 50ma.
RSI Grid: Market shows no bias now at RSI 57.9.
GOLD
Strategies: Weakening uptrend with 5ma below the 10ma. Market remains in bullish posture above the 50ma. Nearest resistance is 836.6. Nearest support is 836.5. Strategy suggests limited selling above the 50ma.
RSI Grid: Market shows no bias now at RSI 49.7%. Strategy suggests standing aside.
This week saw a steady to better trade in most of the major USD pairs. This week saw the pound move lower against the Dollar triggering aggressive selling in the 50ma strategy. This is a complete flip flop from the week before which was aggressively buying. Watch for a possible breakout lower in the GBP/USD pair. We are right near support and below the 50% correction. It could pick up steam with support being taken out.
RSI saw long grid trigger in the AUD/NZD and brief short grid triggers in the EUR/CAD and USD/CAD.
Notable Chart Patterns:
Gold: Market consolidation forming a symmetrical triangle. Breakout in either direction should signal major trend in direction of breakout. 1-2-3 top is intact watch for confirmation of signal which would be lower.
GBP/USD: Loose head and shoulder top. Market sitting on support. Watch for break lower. 1-2-3 top is confirmed with prices breaking lower past the #2 point.
USD/CAD: Market has rallied past 50% correction. Look for the uptrend to continue with minor setbacks.
AUD/NZD: Market has declined past the 50% correction. Look for the downtrend to continue with minor rally corrections.
AUD.USD
Strategies----50ma: Strong downtrend with 5ma below 10ma. Market is in bearish posture below the 50ma. Nearest resistance is market high of .937. Nearest support is 50% retracement @ .85. Strategy suggests aggressive selling under 50ma.
RSI (14) Grid: RSI is 45.17 suggest standing aside.
EUR.USD
Strategies----50ma: Weakening uptrend with 5ma moving below the 10ma. Market remains in bullish posture above the 50ma. Nearest support is 50% retracement @ 1.42. Nearest resistance is market high of 1.492. Strategy suggests limited selling above 50ma.
RSI (14) Grid: Market @ RSI 51.46 suggests standing aside.
USD.CHF
Strategies---50ma: Weakening downtrend with 5ma above the 10ma. Market remains is a bearish posture below 50ma. Nearest resistance is 50% correction at 1.141. Nearest support is 1.089. Strategy suggests limited buying below 50ma.
RSI Grid: Market is in neutral territory now at RSI 51.089. Strategy suggests standing aside.
GBP.USD
Strategies---50ma: Strong downtrend with 5ma below the 10ma. Market is in a bearish posture below 50ma. Nearest resistance is 2.083 the most recent high. Nearest support is 2.026. Strategy suggests aggressive selling above 50ma.
RSI Grid: Market shows no bias now at RSI 39.36. Strategy suggests standing aside.
USD.JPY
Strategies—50ma: Weakening downtrend with 5ma moving above 10ma. Market remains in bearish posture below 50ma. Nearest resistance is 112.75 the 50% correction. Nearest support is last market low of 107.21. Strategy suggests limited buying below 50ma.
RSI Grid: Market is in neutral territory now at RSI 49.78. Strategy suggests standing aside.
USD.CAD
Strategies---50ma: Strong uptrend with 5ma above the 10ma. Market remains in bullish posture above the 50ma. Nearest resistance is 1.085 the most recent high. Nearest support is recent low of .9056. Strategy suggests aggressive buying above the 50ma.
RSI Grid: Market shows no bias now at RSI 60.29. Strategy suggests standing aside.
NZD.USD
Strategies---50ma: Strong uptrend with 5ma above the 10ma. Market remains in bullish posture above the 50ma. Nearest resistance is .79. Nearest support is .7445. Strategy suggests aggressive buying above the 50ma.
RSI Grid: Market shows no bias now at RSI 57.9.
GOLD
Strategies: Weakening uptrend with 5ma below the 10ma. Market remains in bullish posture above the 50ma. Nearest resistance is 836.6. Nearest support is 836.5. Strategy suggests limited selling above the 50ma.
RSI Grid: Market shows no bias now at RSI 49.7%. Strategy suggests standing aside.
Saturday, December 1, 2007
Corn Spread
Here's the easiest money you'll ever make. Go long cn09 go short cz08. History of this spread shows that a -10 or better entry will yield 15-20 cents.
FX Weekly Roundup
Weekly FX Summary
This week saw a reasonable rebound in most of the major dollar pairs including gold. It remains to be seen whether this is an honest return to a strong dollar rally or just a correction. The dollar’s decline has been fast and furious. If most of these pairs want to simply correct back to the 50% retracements (50% retracements are my main target for corrections), it would be a very large move. The Fed looks to cut interest rates which will pressure the dollar short term.
Most notable chart patterns are in the Pound and Gold both pounding out a 1-2-3 top. Watch these markets for confirmations (a breach of the number 2 point).
Also to note the below pairs are about ½ the currency pairs I trade. After this week, I currently have no pairs that have triggered the RSI grid in either direction. I think that is a first.
I’ll try and get these updates posted every Saturday.
Interested in Forex investing but don’t know were to go? I’m tossing around starting a “FX pool” starting at the first of the year. E-mail me with your questions or comments – jmk@jamesology.com
AUD.USD
Strategies----
50ma: Weakening downtrend with 5ma and 10ma the same. Market is in bearish posture below the 50ma. Nearest resistance is 50ma at .8956. Strategy suggests aggressive selling under 50ma.
RSI (14) Grid: RSI is 47.33 suggest standing aside.
EUR.USD
Strategies----
50ma: Weakening uptrend with 5ma moving below the 10ma. Market remains in bullish rally above the 50ma. Nearest support is 1.45. 50ma is 1.4421. Strategy suggests limited selling above 50ma.
RSI (14) Grid: Coming off of oversold and now below the 70% grid sell trigger. Strategy suggest standing aside.
USD.CHF
Strategies---
50ma: Weakening downtrend with 5ma moving above the 10ma. Market remains is a bearish posture below 50ma. Nearest resistance is 50ma at 1.15 which is also 50% retracement. Strategy suggests limited buying below 50ma then aggressive buying above the 50ma.
RSI Grid: Market is coming off of oversold territory now at RSI 52.15. Strategy suggest standing aside.
GBP.USD
Strategies---
50ma: Strong uptrend with 5ma above the 10ma. Market remains in a bullish posture above 50ma. Nearest resistance is 2.116 the recent high. Strategy suggests aggressive buying above 50ma.
RSI Grid: Market shows no bias now at RSI 48. Strategy suggests standing aside.
USD.JPY
Strategies—
50ma: Weakening downtrend with 5ma moving above 10ma. Market remains in bearish posture below 50ma. Nearest resistance is 112.82. Strategy suggests limited buying below 50ma then aggressive buying above 50ma.
RSI Grid: Market is coming off of oversold territory now at RSI 49.78. Strategy suggests standing aside.
USD.CAD
Strategies---
50ma: Strong uptrend with 5ma above the 10ma. Market remains in bullish posture above the 50ma. Nearest resistance is 1 where the market is currently. Strategy suggests aggressive buying above the 50ma.
RSI Grid: Market shows no bias now at RSI 60. Strategy suggests standing aside.
NZD.USD
Strategies---
50ma: Strong uptrend with 5ma above the 10ma. Market remains in bullish posture above the 50ma. Nearest resistance is .79. Strategy suggests aggressive buying above the 50ma.
RSI Grid: Market shows no bias now at RSI 51.
GOLD
Strategies: Weakening uptrend with 5ma and 10ma the same value. Market remains in bullish posture above the 50ma. Nearest resistance is 836.6. Strategy suggests aggressive buying above the 50ma.
RSI Grid: Market shows no bias now at RSI 45%. Strategy suggests standing aside.
This week saw a reasonable rebound in most of the major dollar pairs including gold. It remains to be seen whether this is an honest return to a strong dollar rally or just a correction. The dollar’s decline has been fast and furious. If most of these pairs want to simply correct back to the 50% retracements (50% retracements are my main target for corrections), it would be a very large move. The Fed looks to cut interest rates which will pressure the dollar short term.
Most notable chart patterns are in the Pound and Gold both pounding out a 1-2-3 top. Watch these markets for confirmations (a breach of the number 2 point).
Also to note the below pairs are about ½ the currency pairs I trade. After this week, I currently have no pairs that have triggered the RSI grid in either direction. I think that is a first.
I’ll try and get these updates posted every Saturday.
Interested in Forex investing but don’t know were to go? I’m tossing around starting a “FX pool” starting at the first of the year. E-mail me with your questions or comments – jmk@jamesology.com
AUD.USD
Strategies----
50ma: Weakening downtrend with 5ma and 10ma the same. Market is in bearish posture below the 50ma. Nearest resistance is 50ma at .8956. Strategy suggests aggressive selling under 50ma.
RSI (14) Grid: RSI is 47.33 suggest standing aside.
EUR.USD
Strategies----
50ma: Weakening uptrend with 5ma moving below the 10ma. Market remains in bullish rally above the 50ma. Nearest support is 1.45. 50ma is 1.4421. Strategy suggests limited selling above 50ma.
RSI (14) Grid: Coming off of oversold and now below the 70% grid sell trigger. Strategy suggest standing aside.
USD.CHF
Strategies---
50ma: Weakening downtrend with 5ma moving above the 10ma. Market remains is a bearish posture below 50ma. Nearest resistance is 50ma at 1.15 which is also 50% retracement. Strategy suggests limited buying below 50ma then aggressive buying above the 50ma.
RSI Grid: Market is coming off of oversold territory now at RSI 52.15. Strategy suggest standing aside.
GBP.USD
Strategies---
50ma: Strong uptrend with 5ma above the 10ma. Market remains in a bullish posture above 50ma. Nearest resistance is 2.116 the recent high. Strategy suggests aggressive buying above 50ma.
RSI Grid: Market shows no bias now at RSI 48. Strategy suggests standing aside.
USD.JPY
Strategies—
50ma: Weakening downtrend with 5ma moving above 10ma. Market remains in bearish posture below 50ma. Nearest resistance is 112.82. Strategy suggests limited buying below 50ma then aggressive buying above 50ma.
RSI Grid: Market is coming off of oversold territory now at RSI 49.78. Strategy suggests standing aside.
USD.CAD
Strategies---
50ma: Strong uptrend with 5ma above the 10ma. Market remains in bullish posture above the 50ma. Nearest resistance is 1 where the market is currently. Strategy suggests aggressive buying above the 50ma.
RSI Grid: Market shows no bias now at RSI 60. Strategy suggests standing aside.
NZD.USD
Strategies---
50ma: Strong uptrend with 5ma above the 10ma. Market remains in bullish posture above the 50ma. Nearest resistance is .79. Strategy suggests aggressive buying above the 50ma.
RSI Grid: Market shows no bias now at RSI 51.
GOLD
Strategies: Weakening uptrend with 5ma and 10ma the same value. Market remains in bullish posture above the 50ma. Nearest resistance is 836.6. Strategy suggests aggressive buying above the 50ma.
RSI Grid: Market shows no bias now at RSI 45%. Strategy suggests standing aside.
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