EOS, Ethereum and Ripple’s XRP – Daily Tech Analysis – 29/02/20

EOS

EOS fell by 2.56% on Friday. Reversing a 2.31% gain from Thursday, EOS ended the day at $3.4287.

A mixed start to the day saw EOS rise to an early morning intraday high $3.6212 before hitting reverse.

Falling short of the first major resistance level at $3.7749, EOS slid to a mid-day intraday low $3.3535.

EOS fell through the first major support level at $3.4250 before recovering. Finding support late on, EOS struck a high $3.6100 before falling back to $3.52 levels.

At the time of writing, EOS was up by 0.44% to $3.5444. A bullish start to the day saw EOS rise from an early morning low $3.5282 to a high $3.5908.

EOS left the major support and resistance levels untested early on.

EOS/USD 29/02/20 Daily Chart

For the day ahead

EOS would need to move back through to $3.60 levels to support a run at the first major resistance level at $3.6888.

Support from the broader market would be needed, however, for EOS to break out from Friday’s high $3.6812.

Barring a broad-based crypto rally, the first major resistance level would likely leave EOS short of $3.70 levels once more.

Failure to move back through to $3.60 levels could see EOS fall back into the red.

A fall back through the morning low to sub-$3.52 levels would bring the first major support level at $3.3611 into play.

Barring an extended crypto sell-off, however, EOS should continue to steer clear of sub-$3.30 levels.

Looking at the Technical Indicators

Major Support Level: $3.3611

Major Resistance Level: $3.6888

23.6% FIB Retracement Level: $6.62

38% FIB Retracement Level: $9.76

62% FIB Retracement Level: $14.82

Ethereum

Ethereum slipped by 0.1% on Friday. Following a 1.72% gain from Thursday, Ethereum ended the day at $227.36.

A mixed start to the day saw Ethereum rise to an early morning intraday high $234.90 before hitting reverse.

Falling short of the first major resistance level at $237.75, Ethereum slid to a mid-day intraday low $213.63.

Ethereum fell through the first major support level at $218.75 before recovering to $230 levels. A final hour pullback to sub-$227.60 levels left Ethereum in the red for the day, however.

At the time of writing, Ethereum was up by 1.05% to $229.75. A bullish start to the day saw Ethereum rise from an early morning low $227.04 to a high $232.20.

Ethereum left the major support and resistance levels untested early on.

ETH/USD 29/02/20 Daily Chart

For the day ahead

Ethereum would need to break back through the morning high $232.20 to bring the first major resistance level at $236.97 into play.

Support from the broader market would be needed, however, for Ethereum to break back through to $230 levels.

Barring a broad-based crypto rally, the first major resistance level at $236.97 should leave Ethereum short of $240 levels.

Failure to move back through the morning high could see Ethereum give up the early gains.

A fall through back through the morning low to sub-$225.30 levels would bring the first major support level at $215.70 into play.

Barring an extended crypto sell-off, however, Ethereum should steer clear of sub-$210 support levels.

Looking at the Technical Indicators

Major Support Level: $215.70

Major Resistance Level: $236.97

23.6% FIB Retracement Level: $257

38.2% FIB Retracement Level: $367

62% FIB Retracement Level: $543

Ripple’s XRP

Ripple’s XRP fell by 0.48% on Friday. Partially reversing a 3.81% gain from Thursday, Ripple’s XRP ended the day at $0.23764.

Tracking the broader market, Ripple’s XRP rose to an early morning intraday high $0.24450 before hitting reverse.

Falling short of the first major resistance level at $0.2490, Ripple’s XRP slid to a mid-day intraday low $0.2290.

Steering clear of the first major support level at $0.2261, Ripple’s XRP recovered to $0.24 levels before falling back into the red.

At the time of writing, Ripple’s XRP was up by 0.28% to $0.23830. A mixed start to the day saw Ripple’s XRP rise to an early morning high $0.24144 before falling to a low $0.23660.

Ripple’s XRP left the major support and resistance levels untested early on.

XRP/USD 29/02/20 Daily Chart

For the day ahead

Ripple’s XRP will need to break back through to $0.24 levels to support a run at the first major resistance level at $0.2451.

Support from the broader market would be needed, however, for Ripple’s XRP to break out from the morning high $0.24144.

Barring an extended crypto rally, the first major resistance levels would likely pin Ripple’s XRP back from $0.25 levels.

Failure to move back through to $0.24 levels could see Ripple’s XRP fall back into the red.

A fall back through to sub-$0.2370 levels would bring the first major support level at $0.2296 into play.

Barring an extended crypto sell-off, however, Ripple’s XRP should steer clear of sub-$0.22 levels on the day.

The second major support level at $0.2215 should limit any downside on the day.

Looking at the Technical Indicators

Major Support Level: $0.2296

Major Resistance Level: $0.2451

23.6% FIB Retracement Level: $0.3638

38.2% FIB Retracement Level: $0.4800

62% FIB Retracement Level: $0.6678

Please let us know what you think in the comments below.

Thanks, Bob

US Stock Market Overview – Stocks Drop and the VIX Surges as the Fed Stands Ready

US stocks continue to tumble on Friday, with the major averages down more than 3% at the lows of the session. Some of the larger tech stocks like Microsoft and Apple slammed lower but rebounded to close well off their lows. Gold prices tumbled on Friday, pulling down the metal mining stocks. The Fed was on the tape mid-day saying that they stand ready to lower rates if need be. The market is currently pricing in 3-rate cuts in 2020 with one coming in March of 2020.

All sectors in the S&P 500 index were lower on Friday, led down by Utilities, Energy was the best performing sector in a down tape. Inflation came out in line with expectations, but this did not affect the 10-year treasury yields which dropped to another all-time low. There is little word from the White House about how they will coordinate a response to the coronavirus which is also keeping inventors skittish. The VIX volatility index hit multi-year highs climbing up to 50%, the highest level since 2008.

Inflation Rises

The Personal-consumption expenditures rose 0.2% in January from December, according to the Commerce Department. Personal income advanced 0.6% last month, the largest gain in 11 months. Expectations were for a  0.2% increase in spending and a 0.4% gain in personal income. Gains in income and spending came against the backdrop of still-modest inflation pressures. The price index for personal consumption expenditures, rose 0.1% on the month and was up 1.7% from a year earlier. Year-over-year price gains were 1.5% in December and 1.3% in November.

Mortgages Continue to Buoy Housing Sales

The spread of the coronavirus and the fears associate with it sent bond yields tumbling, the average rate on the popular 30-year fixed mortgage fell to 3.23%, an 8-year low. The lower yields are buoying housing sales. The 30-year fixed loosely follows the yield on the 10-year Treasury, which is now at a record low.

S&P 500 Weekly Price Forecast – Stock Markets Have Worst Weekend Years

The S&P 500 has had a horrific week, showing extreme volume to the downside. By reaching all the way down to at least the 2900 level during the week, the market looks as if it is starting to change its tune in general. That makes quite a bit of sense as coronavirus is starting to spread, and there’s no way to price and what kind of damage a global epidemic could cause. At the very least, you will be looking at economies slowing down, if not grinding to a standstill.

S&P 500 Video 02.03.20

I believe at this point it’s very likely that the market participants will continue to see value hunters eventually, but we need to see some type of headway made when it comes to the coronavirus and its spread. There might be central bank coordinated efforts over the weekend, but quite frankly that will only be a temporary solution to this very major problem. At this point, rallies are to be sold into, and certainly can’t be trusted, at least not until some type of major change comes along. This has been absolutely brutal week, and typically weeks like this down end up being a “one-off event.” With this, I remain bearish but recognize that a relief rally probably comes relatively soon. That relief rally will simply be an opportunity to get short yet again or perhaps short covering done by others. It’s not assigned to start jumping into the market without some type of actual fundamental change in what’s going on.

Silver Weekly Price Forecast – Silver Markets Crater

Silver markets initially rally during the week, but then got absolutely slaughtered as risk appetite around the world continues to crater due to the coronavirus. The silver markets selling off on a sign of lowered industrial demand, and quite frankly probably some forced liquidation as traders need to raise capital to cover margin in other markets. There have been horrific losses in other assets so sometimes traders need to shift funds around, and this is especially true in situations like we have right now.

SILVER Video 02.03.20

To the downside, the $16.00 level underneath offers a lot of support, so I think that might be where the market goes looking to find buyers. The candlestick closing as low as it has during the week shows just how much negativity there is, as the bloodshed on the world’s exchanges hasn’t ended. I fully anticipate that we will continue to go lower, and any rally at this point will probably be sold into on signs of exhaustion.

However, if central banks around the world start cutting rates, and I suspect that could happen over the weekend, that might have the opposite effect in this market in sending precious metals higher. It is a bit of a guess at this point, but that certainly would be the type of wildcard that could change things. This weekend is going to be crucial as to where we go next, and the world’s central banks are most certainly on notice at this point. Ultimately, there are probably more losses but eventually silver will offer a bit of value, which again I suspect is closer to the $16.00 level underneath. At that point in time it might be a longer-term “buy-and-hold” scenario.

Gold Price Prediction – Prices Tumble as Momentum Turns Negative

Gold prices were hammered on Friday as a crowded trade lost many weak longs. Prices sliced through short term support levels, despite declining US yields but a steady dollar. Generally, gold prices are negatively correlated to the 10-year yield but the correlation has broken down as gold drop in tandem with US yields. US personal consumption expectations rose in January to an 11-month high.

Technical Analysis

 

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Gold prices were hammered on Friday, as trades quickly exited pushed the yellow metal down more than 4%. Volatility on gold prices surged higher but eased into the close. Why concerns over the spread of the coronavirus continue to weigh on riskier assets, gold has been immune and up until Friday used as a safe-haven asset. Prices sliced through support near the 10-day moving average which is now seen as resistance at 1,615. Prices bounced near the 50-day moving average at 1,569. Prices have also slipped through an upward sloping trend line that comes in near 1,571.

Medium-term momentum has turned negative as the MACD (moving average convergence divergence) index generated a crossover sell signal. This occurs as the MACD line (the 12-day moving average minus the 26-day moving average) crosses above the MACD signal line (the 9-day moving average of the MACD line). The MACD histogram also generated a crossover sell signal, crossing through the zero index level. The downward sloping trajectory of the MACD histogram points to accelerating negative momentum.

Inflation Rises

The Personal-consumption expenditures rose 0.2% in January from December, according to the Commerce Department. Personal income advanced 0.6% last month, the largest gain in 11 months. Expectations were for a  0.2% increase in spending and a 0.4% gain in personal income. Gains in income and spending came against the backdrop of still-modest inflation pressures. The price index for personal consumption expenditures, rose 0.1% on the month and was up 1.7% from a year earlier. Year-over-year price gains were 1.5% in December and 1.3% in November.

Crude Oil Weekly Price Forecast – Crude Oil Markets Take a Beating for the Week

WTI Crude Oil

The WTI Crude Oil market broke down rather significantly during the trading week, slicing down through the $45 level. Ultimately, this is a market that looks as if it is going to try to make its way down to the $40 level, where there should be a significant amount of support. The crude oil markets continue to suffer at the hands of the coronavirus, and therefore there is no real way to measure risk, and that’s one of the biggest problems with this market right now. When you look at the candlestick, it’s clearly negative and there is no real attempt to rally. Ultimately, I think that the $40 level will offer a significant about the support, but it’s almost going to have to be something OPEC does as far as production cuts on an emergency meeting. Otherwise, any bounce that we get could be somewhat technical but slicing through the $40 level would be a horrific turn of events. For what it’s worth, looking at the daily chart, it looks as if we had formed a very flat, and that does measure for a move to $35 albeit being a bit optimistic for the sellers. Rallies are to be sold.

WTI Oil Video 02.03.20

Brent

Brent markets also have broken down a bit during the week as well, slicing through the $50 level. Ultimately, the market then goes looking towards the $42.50 level. At this point in time I think that rallies are to be sold into, unless something structurally changes. Demand for crude oil is falling through the floor, and quite frankly there is far too much in the way of supply to think that we have a real chance of recovering for any length of time.

Natural Gas Weekly Price Forecast – Natural Gas Markets Continue to Show Negativity

Natural gas markets have broken down significantly during the week, slicing through the $1.80 level. That’s an area that has been supportive in the past, and at this point the fact that the market has broken down suggests that we are going to go lower. The oversupply of natural gas continues to be a major problem with this market, as fracking continues to produce way too much. Furthermore, the warmer temperatures coming does not help the situation, and beyond that we have received a very bearish inventory report this past week, so at this point it’s likely that we will see plenty of sellers. The question now is whether or not we can break down below the $1.60 level, and if we do that would be quite remarkable.

NATGAS Video 02.03.20

To the upside, the market could very well try to reach towards the $1.80 level before selling off again, or perhaps even the $2.00 level. I have no interest in buying this market, because quite frankly this is a market that has been far too oversold for far too long to believe that it is suddenly going to change its tune. With warmer temperatures, and oversupply of natural gas, and quite frankly now the worry about the coronavirus killing off demand, it’s very unlikely that this market will be able to recover anytime soon. It is going to take several bankruptcies in the United States when it comes to natural gas suppliers and drillers in order to bring down the commodity supply. At this point, market participants continue to sell rallies.

Gold Weekly Price Forecast – Gold Markets Crater for The Week

Gold markets initially shot higher during the week, reaching towards the $1700 level. That is an area that of course offers a lot of resistance, as it is a large, round, psychologically significant figure. By turning around the way it has, it looks extraordinarily negative as we sliced through the $1600 level. By breaking through there, it shows quite a bit of negativity and a real lack of follow-through. At this point, it’s likely that the market continues to go a little bit lower, or perhaps kills time by going sideways. A simple bounce back is a bit much to ask, at least without some type of stabilization.

Gold Price Predictions Video 02.03.20

The market is still in an uptrend, but this is clearly a “shot across the bow” for those who would be bullish of gold. Longer-term, it’s probably very likely that we do continue to the upside in a bit of a safe haven bit, but a lot of forced liquidation has been going on this week, as margin calls are being fired off in other markets. Large funds will have to sell profitable positions to keep afloat, and that may be what’s going on with the gold market currently. It certainly isn’t US dollar strength, because quite frankly there is none. At this point, it’s likely that the market continues to be very jittery and nervous, so if you are looking to go long, waiting for some type of supportive daily candlestick is probably the best way to go. That, or perhaps a recapturing of the $1600 level.

Gold Price Forecast – Why Are Gold Prices Crashing with Stocks?

Gold prices are crashing as we head into Friday’s close. The Fed may use its emergency powers to slash interest rates as soon as this weekend. A surprise rate cut could stabilize gold prices and stop this unjustified liquidation.

Trying to make sense of these markets is impossible. If I told you U.S. stocks would crash 14% in one week – how high would you expect gold prices to jump? $50…$100…$150? I would guess at least $100 but probably more. Nope – gold is down over $50.00 on Friday.

All week I’ve been monitoring the Fed Watch Tool for clues regarding interest rates. On Tuesday, the odds for a March 18th rate cut started at 14.4%, by the close they had jumped to 27.7%. As we head into the weekend, they’re now proposing a 100% chance for a 0.25% cut and a 47.2% chance for a 0.50% cut.

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Note: The odds for a .50% cut were 0% yesterday. The Fed could move as soon as this weekend. 

I try not to cry manipulation, but it’s hard to justify this week’s price action as natural. It seems several forces were at play, much out of our control. It appears someone wants the Fed to ease, and this week’s crash makes that possible. Sadly, many investors were hurt and shaken out of their positions in the process.

I don’t have a crystal ball, and I’m not sure what will happen next week. But I do know governments are running out of options to stimulate economies; interest rates are at all-time lows. All they have left is money printing, and that will lead to much higher precious metal prices.

AG Thorson is a registered CMT and expert in technical analysis. He believes we are in the final stages of a global debt super-cycle. For more information, please visit https://goldpredict.com/

S&P 500 Price Forecast – Stock Markets Have Wild Ride on Friday

The S&P 500 broke down significantly again during the trading session on Friday, showing signs of stability midday. Having said that, the market is extraordinarily oversold, and we have just seen one of the worst selloffs ever. At this point, the market is likely to see a hard bounce, but that bounce may or may not be sustainable. Quite frankly, I don’t think it’s likely to happen. The 200 day EMA above will more than likely offer resistance, and it’s not until we clear that level on a daily close then I think the market can truly bounce.

S&P 500 Video 02.03.20

The weekend can bring anything, not the least of which would be central banks deciding to cut rates or do something to help markets. That being said though, it can only help so much and at this point I think that the markets are probably resigned to sell rallies in the short term, at least until the coronavirus disappears or at least gets under control before the market can truly gain for a longer-term move. To the downside, if we were to break down below the lows of the Friday session this could really start to unwind things in cause a lot of problems. At this point, I don’t see an argument to start buying, at least not without some type of major help from outside. Overall, this is a market that if you try to bite here you might be “catching a falling knife.” Any bounce later in the day could be simple short covering than anything else. At this point, the sellers are still very much in control.

Silver Price Forecast – Silver Markets Break Down Drastically

Silver markets broke down significantly during the trading session on Friday, breaking through the 200 day EMA which of course is a very negative sign. Silver is going to be a bit interesting considering that the market participants are likely to go looking at the $16.50 level. That’s an area that I think continues to attract a lot of attention as it was previous support but quite frankly it’s probably only a matter of time before we break down a bit. Precious metals of course are a bit of a safe haven when it comes to markets, but silver has an industrial component as well, and that of course is part of what’s getting punished.

SILVER Video 02.03.20

Furthermore, the markets may have witnessed a bit of forced liquidation of silver as a lot of traders would have been in profit. By taking profits here they can pay for losses elsewhere. That’s simply the market looking for liquidity where it can find it. At this point, silver is more than likely going to find a bottom, but I think we may have a little bit more pain to go. Over the weekend we may get some central bank interest-rate cuts, so that could help silver, but there are far too many question marks out there right now to simply put money to work. This is a very dangerous market and essentially a “50-50 proposition” that we are dealing with. At that point, it’s no longer trading but it then becomes gambling. That of course is not very advisable. Expect extreme volatility on Monday regardless of what happens over the weekend.

Crude Oil Price Forecast – Crude Oil Markets Break Down Yet Again on Friday

WTI Crude Oil

The West Texas Intermediate Crude Oil market has broken down significantly during the trading session on Friday to slice down below the $45 level. It is possible that we get a bit of a bounce from here, but any bounce should be sold into, especially if we get closer to the $50 level. OPEC needs to cut production to have any hope of a bounce for a longer-term move, and quite frankly even then I don’t think that will be enough as people are worried about global demand and the longer-term oversupply that we already have. With that being the case, I am a seller. However, if we break down below the lows again, we could go looking towards the $40 level.

Crude Oil Video 02.03.20

Brent

Brent markets have also broken down, to slice down below the $50 level. It’s very likely that the market may go looking towards the $45 level given enough time, but in the short term a little bit of a recovery may be possible. That recovery should continue to be sold into as there are far too many reasons to think that this market is going to fall apart again. Granted, we can’t go in one direction forever but clearly buying is all but impossible less something drastically changes. We would need to see the coronavirus situation suddenly disappear, something that’s not going to happen. Ultimately, this is a market that seems as if it is going to go lower given enough time but with all things, you don’t chase the trade.

Natural Gas Price Forecast – Natural Gas Markets Fall Yet Again

Natural gas markets have broken down a bit during the trading session on Friday again, as the market continues to show signs of weakness. Quite frankly, the oversupply of natural gas doesn’t seem to be going the way anytime soon, and therefore I think that rallies will continue to be sold. We are starting to see a little bit of a bounce late in the day but that’s probably just people taking profits into the weekend.

NATGAS Video 02.03.20

The inventory figure this week was miserable, showing that there is not enough demand still. The lack of demand by the markets for natural gas continues to hamper any type of price appreciation, but quite frankly we have much bigger issues than that now. The oversupply simply is going nowhere until there are bankruptcies in the United States. We are about to see massive credit issues for a lot of the companies that have been supplying the market was so much natural gas, and that will force bankruptcies. That in turn will eventually disrupt supply, something the market desperately needs. Until then, it’s all but impossible to buy this market, because quite frankly there are too many things working against it.

Furthermore, the weather in the United States continues to be warming up, and that will drive down demand as well. At this point in time, there’s nothing good about this market in fading the rallies continues to be a major issue. The $1.80 level would be the first place at be looking to sell on signs of weakness, followed by the $2.00 level after that. In fact, I see the $0.20 region as an entire barrier that will be broken.

Gold Price Forecast – Forced Selling Of Yellow Metal

Gold markets fell hard during the session on Friday, as we have sliced through the $1600 level. By doing so, the market shows signs of extreme weakness as we have not only broken through a big figure, but we have also touched the 50 day EMA. Looking at this candlestick, it is extraordinarily negative, but at this point if we break down below the 50 day EMA it could unwind this market even further. The $1550 level will be the next target, and then eventually the $1500 level. At this point, any rally needs to clear the $1600 level on a daily close to begin buying. If we do that before the weekend, then it might be a bit of speculation that the server banks around the world looking to cut interest rates, but quite frankly that is still a gas.

Gold Price Predictions Video 02.03.20

If the market gets news over the weekend, this could be an extraordinarily volatile place to be. Quite frankly, pay attention to the $1600 level to determine which direction you should be trading, but you won’t be able to have that information until the markets open up. This weekend could be extraordinarily important for gold, so to suggest that we know what’s going to happen before all of the news gets out of the way would quite frankly be ineffectual. The world is certainly teetering on the edge of panic, and eventually that should help gold but we don’t know where the bottom is quite yet.

USD/JPY Weekly Price Forecast – US Dollar Gets Crushed Against Japanese Yen For The Week

The US dollar has broken down significantly against the Japanese yen during the week as the stock markets in New York have been crushed in ways that we haven’t seen since the financial crisis. At this point, we are testing the ¥108 region, which should be supportive. If the market breaks down below there it’s likely to go towards the ¥105 level over the longer term. That being said, we could get a bit of a bounce and go looking towards the ¥110 level above. That is essentially “fair value” for the overall consolidation.

USD/JPY Video 02.03.20

The overall consolidation runs from ¥115 to the upside down to the ¥105 level on the downside. Based upon this candlestick, I do think it’s more likely that we go looking towards the downside but don’t be surprised at all if we see some type of short-term bounce in the process. If we were to break down below the ¥105 level, it would be crucial at that point and we would probably see this market drop down to the ¥100 level, an area that has traditionally caught the attention of the Bank of Japan. To the upside, if the market was to take out the highs of the week, that would obviously be a very bullish sign, but I give that about a 5% chance of happening anytime soon. This is a market that you should be looking for opportunities to sell after bounces, but you may have to do so from shorter-term timeframe such as the daily or the four hour charts.

GBP/USD Weekly Price Forecast – British Pound Roles Over For The Week

The British pound initially tried to rally during the week, reaching towards the 200 week EMA before rolling over. That shows signs of weakness, and perhaps more than likely going to show that the British pound is clearly susceptible to the global “risk off” situation that we find ourselves in. That being the case, it’s likely that we will continue to see a lot of back and forth and although the British pound is going to suffer at the hands of risk appetite falling, the reality is that there is significant support just below so if you are looking to buy the US dollar, although the trade may work in this pair, you may find better momentum in some of the other pairs, specifically the Euro.

GBP/USD Video 02.03.20

At this point, I believe that short-term traders will continue to try to fade rallies, but if we were to break down below the red 50 week EMA on the chart, that probably sends this market much lower, perhaps even as low as the 1.25 handle. At this point in time though it’s obvious that the markets are very jittery and it’s going to take very little to knock them over. As far as rallies are concerned, I would not believe them in this pair until we break above the 200 week EMA which is painted in black on the chart. At that point, we could go as high as the 1.35 handle over the longer term. Expect a lot of volatility but in the end, I believe that the US dollar will strengthen against most currencies.

GBP/JPY Weekly Price Forecast – British Pound Continues to Get Hammered Against Japanese Yen

The British pound broke down significantly during the week, slicing through the ¥140 level. At this point, the market is likely to test the ¥139 level, and if it breaks down below there it’s likely that we will continue to see exacerbated losses. At this point, it’s only a matter of time before that happens from what I see, and when that does kick off, we could drop rather precipitously. The market is clearly failing in general, as the Japanese yen is being used as a safety currency.

GBP/JPY Video 02.03.20

The size of this candlestick is of course rather impressive, and it has wiped out quite a bit of constructive action as of late. The coronavirus continues to cause a lot of headline risk out there, and clearly the Japanese yen being used as a safety currency isn’t that big of a surprise. At this point, rallies are to be looked at with suspicion, and as a result it’s very likely that the short-term rallies will end up being selling opportunities, and as a result it’s likely that the pair does eventually break down, but it could be very noisy along the way. Once this pair does break down, it’s likely that it could be looking at a move down to the ¥135 much quicker than anticipated. However, one has to wonder how much more fear there is out there when it comes to the markets in the short term, so a slight bounce really isn’t out of the question at this point in time.

EUR/USD Weekly Price Forecast – Euro Recovers For The Week

The Euro has broken to the upside during the trading week to break above the 1.10 level. That of course is an area that should attract a lot of attention from a psychological standpoint, and it should be noted that the Friday session is forming a somewhat exhaustive looking candle. The weekly candle looks much more bullish though, so at this point it’s likely that we will have a bit of a fight in this general vicinity.

EUR/USD Video 02.03.20

At this point in time, most of the selloff of the US dollar has more to do with the stock market and people repatriating money back to their home countries as the US stock market got absolutely crushed for the week. Ultimately, this is a market that has been in a downtrend for some time, so quite frankly I don’t feel the need to try to buy this market, and the fact that the market is giving up quite a bit heading into the weekend suggests that the downtrend will continue to show itself. Ultimately, this is a market that I do think tests the lows again, but if we were to break above the red 50 week EMA then we have to somewhat reconsider the situation.

The European Union is very likely that in a recession, and the ECB is much looser than the Federal Reserve. Coronavirus cases are breaking out all over Europe, and as a result it’s much more palatable to short this market than trying to buy it. Fading rallies on short-term charts should lead to longer term decline still.

AUD/USD Weekly Price Forecast – Australian Dollar Gets Crushed for The Week

The Australian dollar initially gapped lower to show signs of weakness, turned around to fill that gap, and then broke down to reach towards the 0.65 level during the Friday session. That of course is a large, round, psychologically significant figure, and therefore it’s likely that the market will react there. We are starting to see a slight bounce during the Friday session, but if we were to break down through that area it opens up the door down to the 0.63 handle which is the bottom of the financial crisis area.

AUD/USD Video 02.03.20

At this point, the market looks as if it could bounce, but bouncing from here could be a nice selling opportunity at signs of exhaustion, and the 0.67 level above will probably offer a bit of a “ceiling” in the market. If we were to break above that level it would change a lot of things but right now, I just don’t see that happening. At this point, the market is likely to bounce a bit, but I look at that bounce as an opportunity to pick up the US dollar “on the cheap.” Ultimately, if we were to break down below the 0.63 level underneath, that would be a disaster for the Aussie. The US dollar should continue to attract quite a bit of inflow due to safety concerns, and of course the fact that the Australians are so highly levered to China itself. With this, keep in mind that we are in a downtrend for a multitude of reasons to begin with, so buying is extraordinarily dangerous.

USD/JPY Price Forecast – US Dollar Continues to Melt Down Against Yen

The US dollar has broken down rather significantly during the training session on Friday, as we continue to see a run to safety and the financial markets. The Japanese yen is reasserting itself as a safety currency, as we have seen in spades over the last several sessions. The US markets have been selling off, and therefore money is flying out of New York as more concerned about coronavirus hit the headlines. As I record this, the Dow Jones Industrial Average is down 900 points, and looking very much like it’s going to reach 1000 lost yet again.

USD/JPY Video 02.03.20

The USD/JPY pair is getting close to the 200 day EMA, an area that will of course attract a lot of attention. At this point, I think that the 200 day EMA could cause a little bit of a bounce, but if we do break down below there then the longer-term trend suddenly becomes negative again. The ¥110 level is essentially “fair value” in the longer-term consolidation area and we have just gotten smoked by a false break out. Because of this, it’s likely that we may return to ¥110 again, as market memory dictates. However, the market is literally moving by the most recent headline, and to be honest the correlation between the S&P 500 in the USD/JPY pair has returned to the norm again, so pay attention to this correlation, as we are getting oversold, and it’s a matter of time before we get some type of nasty bounce. In other words, you can’t short the market quite right now, as you would be “chasing the trade.” That being said, it will be interesting to see what happens next but I would advise keeping a very small position regardless of what you choose to do.