The S&P 500 initially tried to rally during the course of the trading session on Thursday but then gave back the gains to start falling again. Quite frankly, there are lot of mixed messages out there when it comes to the economy in the stock market went forward, but at the end of the day we are still very much in an uptrend and it is worth paying attention to. The 4100 level underneath should offer support, as it has over the last couple weeks. That being said, there is even more support underneath at the 50 day EMA and of course the 4000 level. With that being said, I think that if we get some type of selling pressure, then we will get long again based upon some type of bounce.
S&P 500 Video 07.05.21
To the upside, I see the 4200 level as a major barrier that needs to be overcome with some type of catalyst. We are in the midst of earnings season and it has gone fairly well but quite frankly the market had already priced all that in. Because of this, I think that we will continue to see a “buy on the dips” type of mentality, as we continue to find plenty of narratives out there to push this market higher. Central banks around the world will continue to flood the markets with liquidity, thereby having people push money into stock markets yet again. I see no scenario in which a willing to start shorting this market anytime soon.
Silver markets initially drifted a little bit lower during the trading session on Thursday but then broke higher to reach towards the $27.35 level. The market certainly looks as if it is on its way to the $28 level, but it is obvious that the market has a lot of noise involved in it. After all, the silver markets do tend to be very choppy to say the least, so it does make quite a bit of sense that we would continue to see volatility. With that being the case, the market is likely to continue seeing short-term pullbacks as potential buying opportunities and of value.
SILVER Video 07.05.21
Underneath, we have the 50 day EMA sitting at the $26 level, and that could of course attract a lot of support and buyers get involved. If we break down below the $26 level, it could open up a move down to the 200 day EMA underneath. We are in an uptrend, there is nothing on this chart that tells us that we should be looking for buying opportunities only, and a break above the $28 level would open up the possibility of a move to the $30 level. All things been equal, I do think that we get there and perhaps even higher as we continue to play the “reflation trade.” Silver has a major industrial component built into it, so it certainly makes a bit of sense that we would be looking at a “buy on the dips” type of scenario. I have no interest whatsoever in shorting this market, as we have such bullish pressure and of course a huge fundamental driver of price.
The West Texas Intermediate Crude Oil market has pulled back a bit during the trading session on Thursday, as we sit right at the $65 level. The $65 level of course is a large, round, psychologically significant figure that would attract a certain amount of attention, but part of what has caused the market pull back a bit is that the demand for gasoline in the United States has fallen for the second week in a row. That being said, the ascending triangle that formed previously does suggest that we have more upward pressure going on than down, as we have been in an uptrend anyway. If we do pull back from here it is likely that we would see plenty of support at both the 50 day EMA and the uptrend line that has been part of that ascending triangle.
Crude Oil Video 07.05.21
Brent markets also look very much the same as you would expect, after forming the same kind of ascending triangle. The $70 level above does offer a certain amount of psychological resistance, so if we can break above there then it is likely that the market would continue to go much higher. A lot of this comes down to the “reopening trade” that a lot of people pay close attention to, so therefore it does make a certain amount of sense that value hunters will be looking to get involved. Once we can clear the $70 level on a daily close, it is very likely that we go much higher, perhaps making a move towards the $72.50 level initially, followed by a move to the $75 level. I have no interest in shorting the market anytime soon.
Natural gas markets have gone back and forth during the course of the trading session on Thursday as we continue to look at the $3.00 level as massive resistance. That is an area that has been difficult for some time, and it should continue to be. Quite frankly, I think this is a market that will see a lot of choppy volatility, but it looks as if we are running out of momentum. The market breaking above the $3.00 level still faces a lot of noise based upon historical behavior, and of course psychological resistance.
NATGAS Video 07.05.21
Given enough time, I fully anticipate that this market will start to fall, perhaps trying to drop down to the $2.75 level initially, followed by the gap underneath it has yet to be filled. After all, we are going to be getting warmer temperatures in the northern hemisphere soon, despite the fact that it has been cooler than usual. With that being said, there will be less demand for natural gas, in a market that is already oversupplied. There has been an uptick in foreign demand for liquefied natural gas, but at this point in time it will be enough to change the market dynamics.
Commodities in general have been getting a bid, so natural gas has become overvalued. I think eventually the fundamentals come back into play and we fall apart. With this, I like the idea of selling at the first sign of a breakdown, because we have such a significant and obvious round figure just above the use as a barrier to determine which direction, we are going in. All things been equal, the spring temperatures will start to overtake the market.
Gold markets have broken higher during the course of the trading session on Thursday as we have cleared the 200 day EMA and the $1800 level. At this point, the market is likely to continue going higher, perhaps reaching towards the $1850 level, and then after that the $1950 level. This of course is a market that has recently formed a bit of a “double bottom”, and that suggests that it has much further to go. It is interesting, because gold has disappeared from the inflation argument until recently, but now it appears that the traders finally starting to kick in.
Gold Price Predictions Video 07.05.21
To the downside, I see the 50 day EMA as offering support, and most certainly the $1750 level will as well. It is not until we break down below there that I would be concerned, but after the action that we have seen during the day on Thursday, it is very likely that the buyers will continue to push to the upside. The size of the candlestick is somewhat impressive, and therefore it looks like there is serious conviction in this market. If the US dollar continues to fall, that should continue to lift gold in general, and therefore I think that we have a “buy on the dips” type of mentality from short-term traders. Ultimately, this will be a very noisy move to the upside, but it certainly looks as if we have made major changes in attitude during the day, as we have been building up pressure for some time. I have no interest in shorting this market until we close below the $1750 level, something that does not look as likely now.
The US dollar initially pulled back slightly during the course of the trading session on Thursday but then turned around to show signs of strength as we reached towards the ¥109.50 level yet again. At this point, it looks as if we are trying to go looking towards the ¥110 level. Keep in mind that Friday is the Non-Farm Payroll announcement, and that of course is going to continue to be influential as to where we go. Ultimately, this is a bullish run and we recently bounced from the 50 day EMA as well as the 38.2% Fibonacci retracement level that of course is a very positive sign.
USD/JPY Video 07.05.21
If we can break above the ¥110 level, then it is likely that we go looking towards the ¥111 level, which was the recent high. If we can break there, then we have a much longer term run higher. On the other hand, we could very well go back and forth in this general vicinity and simply grind. All things been equal, I have no interest in shorting this market until we break down below those hammers that caused the bounce in the first place. In general, this is a market that is very strong, but certainly will be waiting to see what the jobs number has to say. I would anticipate quite a bit of volatility during the trading session on Friday, as the market will probably have to readjust its expectations depending on whatever number comes out. There are wide and varied expectations for the figure coming out, so I anticipate more chaos than anything else.
The British pound has gone back and forth during the trading session on Thursday as the Monetary Policy Committee has come and gone, suggesting that tapering is coming in the bond market. That of course is bullish for the British pound, but at the same time we have been locked in a lot of support and resistance in this general vicinity.
GBP/USD Video 07.05.21
When you look at the 50 day EMA, has offered a bit of support as of late, so that is something worth paying attention to. Furthermore, we have the double bottom underneath there that continues to support the market as well. It is not until we break down below there that I think we could start to see the first “cracks in the ice” of the uptrend but if you are a seller, you then need to worry about the 1.35 level underneath which is attracting the 200 day EMA. Underneath there, then obviously the trend is done.
To the upside, the 1.40 level continues to be like a “brick wall for the market” and breaking above there on a daily close would be a massively bullish sign. In the short term, I think we simply go back and forth in the fact that we have the jobs number coming out on Friday certainly makes quite a bit of sense. Ultimately, this is a market that is been very volatile for the session, but it seems to have been little changed. Interesting to see this reaction, but at the end of the day I think people almost immediately turn their attention on the employment situation in America.
The British pound has initially pulled back a bit during the course of the trading session on Thursday but turned around to show signs of strength again as the Bank of England is suggesting that they will be tapering bond purchases, which is a form of monetary policy tightening. This follows the Bank of Canada, as we are starting to see central banks try to get ahead of the reopening trade.
GBP/JPY Video 07.05.21
The Japanese yen continues to get beaten up, and that of course will not be any different here. The ¥150 level underneath is rather significantly supported, not only due to the fact that we have seen a bit of a bounce from there, but we have also seen the 50 day EMA coming into the picture. With that being the case, I think it is only a matter of time before buyers will come back into this market if we reach down towards that area.
On the other hand, it looks much more likely that we are going to go looking towards the ¥153.50 level, and then possibly reaching towards the ¥155 level. This is a market that has been in a very bullish move over the last several months, and now we are simply grinding back and forth in order to try and pick up more momentum while working off froth. Eventually, I anticipate that the buyers will continue to look it dips as value in a market that has been obviously one way for quite some time. I anticipate that the Friday market might be a little bit quiet ahead of the jobs number but if we get a good number out of the United States, we may get more “risk on behavior”, sending this pair higher.
The Euro has bounced from the 1.20 level to show signs of strength again during the Thursday session. This front run the jobs number coming out of America so it will be interesting to see how this plays out. I do think that there is a little bit of resistance just above that could cause some issues, but at the end of the day we are in an uptrend and you could even make a little bit of an argument for a bullish flag or on shorter time frames a falling wedge.
EUR/USD Video 07.05.21
It is obvious that the 1.20 level would catch a lot of attention, and of course the 50 day EMA sitting there makes quite a bit of sense as far as support goes as well. With all of that in mind I think that what we are looking at is the possibility of a move back towards the highs that we made a couple of weeks ago. Ultimately, I think that this remains a short-term “buy on the dip” type of market, but if we were to break down below the 50 day EMA, perhaps after the jobs figure, then we will more than likely go looking towards the 200 day EMA underneath.
Remember, this pair does tend to be very choppy and sideways most of the time so although it is grinding higher, you will probably find more value buying the Euro against other currencies. In the short term though, the US dollar is on its back foot and as long as that continues to be the case in general, that will lift this pair and perhaps send it towards the 1.23 handle.
The Australian dollar initially pulled back during the course of the trading session on Thursday to reach down towards the 50 day EMA. Ultimately, it looks as if the market is trying to build up enough momentum to finally break above the 0.78 handle, which of course is the massive resistance barrier that the market has been fighting for some time. All things been equal, the market breaking above there could open up the possibility of a move to the 0.80 level given enough time. That of course is an area that is important from a longer-term standpoint, as you can see it clearly as resistance on the monthly chart.
AUD/USD Video 07.05.21
Ultimately, if we can break above that 0.80 region of resistance, this market will go much higher. It would then become a “buy-and-hold” situation, but overnight China decided that they were going to end all discussions involving trade with the Australians, so there was a little bit of a selloff that lasted just a short amount of time. Ultimately, the commodity boom should continue to lift the Australian dollar over the longer term, but obviously we have a lot of noise to deal with. The last couple of months have been very difficult, and it appears that we have more of the same ahead of us.
That being said, if we were to turn around and break below the 0.76 level it is likely that we could go looking towards the 0.75 level. If we break down below that handle, then I believe that the Australian dollar probably needs to “reset” closer to the 0.70 level which of course is an area that will attract a lot of attention due to the psychological importance of it.
The S&P 500 continues to go sideways, but at this point in time that has to be thought of as somewhat bullish after the massive recovery that we had seen late in the day on Tuesday. In other words, it suggests that we are looking at a market that is simply trying to hang on to the bullish trend, but in general this is a market that probably needs to sit still until we get the noise on Friday out of the way. After all, the Nine Farm Payroll announcement is one of the most disruptive announcement out there.
S&P 500 Video 06.05.21
To the downside, the 4100 level looks to be supportive, and most certainly the 50 day EMA will be down by the gap just above the 4000 handle. The 4000 handle of course is a large, round, psychologically significant figure, and between that and the gap, and of course the 200 day EMA, this is a market where there should be plenty of buyers underneath. If we did break down below all of that then we probably go looking towards the 3800 level.
In general, you can only buy the S&P 500 because it is far too manipulated via central bank liquidity measures. Furthermore, it is not an equal weighted index so there is no reason to short it if just a handful of the top stocks are rallying. With that being the case, I do think eventually we break above the 4200 level, then I think the market probably goes looking towards the 4400 level, and therefore I think what we are looking at is a scenario where we could see another 200 points to the upside, but we need to see an impulsive candlestick and a daily close above 4200 to make that move.
Silver markets have rallied a bit during the course of the trading session after initially falling on Wednesday to find the 50 day EMA important enough to hang onto. The 50 day EMA sits at the $60 level, so that of course comes into focus as well. It is an area that has been supportive for a couple of weeks now, and it certainly looks as if silver is trying to stabilize currently. With that being the case, I like the idea of buying dips, but I recognize it is probably going to take a while to get to where we are going.
SILVER Video 06.05.21
If we did break down below the 50 day EMA, I think that the 200 day EMA then comes into focus, currently sitting at the $24.50 level. We also have the psychological barrier in the form of the $25 level, so I do think that in general we continue to find value hunters, but this is based upon the reopening trade, and not so much the US dollar as of late. In other words, it does have a fundamental catalyst to go looking towards the $28 level, but it is going to be a grind more than anything else. Because of this, I think you should keep your position size relatively small and billed as the trade goes in your favor. Shorting is not something I am interested in doing currently.
The West Texas Intermediate Crude Oil market has gapped higher to kick off the trading session on Wednesday, pulled back a bit to fill that gap, and then turned around to show signs of strength. Ultimately, this is a market that is trying to go higher, and therefore I think what we are looking at is a potential move towards the $70 level given enough time. All things been equal, I think that the market is likely to be to see the uptrend line from the previous triangle and the 50 day EMA. All things been equal, this remains a “buy on the dips” type of scenario as the world trade to the “reopening trade.”
Crude Oil Video 06.05.21
Brent markets have gapped higher to kick off the trading session as well, reaching towards the $70 level before pulling back a bit and then bouncing again. If we can get a daily close above the $70 level, then it is likely that we go much higher. If we break above there, then we are looking at a potential move to the $75 level. All things been equal, it is very difficult to imagine a scenario where I would be a seller, so with that being the case I am simply looking at this as a “long only” trade, but I also recognize that with the jobs number coming out on Friday it is very likely that we will continue to see a lot of choppy action between now and then. Regardless, I see no scenario in which I would be a seller as we are so strong in general.
Natural gas markets have again struggled at the $3.00 level, an area that you would think would have to have a lot of options attached to it and therefore big positions. While the temperatures in the United States have been cooler than anticipated, the reality is that sooner or later the oversupply of natural gas comes back into the picture. There has been foreign demand for liquefied natural gas, but at the end of the day there is more than enough natural gas in the United States to cover all bases.
NATGAS Video 06.05.21
Because of this, I am looking for a selling opportunity and it certainly looks as if we are trying to build one in this area. We have had a couple of exhaustive candlesticks, so quite frankly it is not a real stretch to imagine that we may fall to reach down towards the previous Which is all the way down near the $2.70 level. In other words, I think we have quite a way to go to the downside given enough time and therefore I think we are looking at a situation that is much easier to sell than by, and quite frankly during this time of year I have no interest in trying to buy natural gas as temperatures will certainly begin to warm up again, and that allows for the idea of cheaper pricing. To the downside, the market very well could try to reach towards the $2.40 level by the end of summer, perhaps even as low as the $2.00 level. There seems to be a massive amount of resistance just above.
Gold markets initially pulled back during the trading session on Wednesday to reach down towards the 50 day EMA, before bouncing a bit and forming a bit of a hammer. At this point, we are still stuck between the 50 day EMA and the 200 day EMA indicators, so therefore not much has changed over the last couple of days. We are simply consolidating, trying to figure out where our next move is.
Gold Price Predictions Video 06.05.21
If we can break above the $1800 level, then it is likely that we go looking towards the $1850 level, followed by the $1950 level. This obviously would be helped by a weakening US dollar, and with the jobs report coming out on Friday that could end up being the catalyst. As of late, gold markets have been paying special attention to the bond market, but the bond market yields have calmed down. The question now is whether or not the market has stabilized in that area, or are we getting ready to see more volatility?
If we were to break down below the $1750 level, then it is likely that we go looking towards the double bottom underneath. The double bottom underneath of course is an area that should be supportive so if we get down below there it is likely that we would break down towards the $1500 level. That would be a very negative move, and if we break the double bottom, I would be more than willing to start shorting this market. Until then, I think we simply go back and forth doing nothing.
The US dollar has gone back and forth against the Japanese yen during trading on Wednesday as we continue to see this market hang around the ¥109.50 level. This is an area where we could see a bit more selling pressure, and the fact that we have the jobs number coming out on Friday will probably continue to cause quite a bit of noise in this market. With that being the case, I think it is only a matter of time before we have to make a bigger move, and the most obvious target above would probably be near the ¥110 level. The ¥110 level has been resistive previously, but we have even broken above there to go towards the ¥111 level, which is my longer-term target if we continue to see upward pressure.
USD/JPY Video 06.05.21
That being said, I do not know that we get a huge move between now and Friday when we get the jobs number. Quite frankly, I think it is going to be difficult to make a big move between now and then, and with that being said I think what we are looking at is a lot of back and forth choppy behavior between now and then. With that in mind, I am somewhat neutral on this pair for the next couple of days, but I recognize that the 50 day EMA underneath could be a target if we do get a selloff, as it should offer support. On the other hand, if we break above the highs of the Monday session, then we will probably go looking towards ¥110, but that is not a very big move.
The British pound has gone back and forth during the course of the trading session on Wednesday as we hang around the 1.39 handle. That is an area that continues to cause a bit of choppiness, and I think that is probably what we are going to see over the next 48 hours. After all, we have the Monetary Policy Committee meeting on Thursday and of course the jobs number on Friday. Ultimately, this is a market that will make a move, but right now it looks as if the 1.40 level above continues to be a massive barrier that the market simply struggles to get beyond. Looking at this chart, I think that we are simply killing time until we get some of those answers.
GBP/USD Video 06.05.21
Underneath, there is a little bit of a double bottom that the market will continue to pay close attention to, and if we were to break down below there then it is likely that the market goes looking towards the 1.35 handle underneath. That is an area where we see the 200 day EMA racing towards, so that should offer a significant amount of support as well. With that being the case, I like the idea of buying in that area if we do get down there, but I just do not see that happening in the short term. Longer-term, I think we are much more likely to break above the 1.40 handle, but that is going to take a significant amount of momentum to make that happen. With this in mind, I like the idea of going long, but I would either wait for a better price, or a breakout above the aforementioned 1.40 handle.
The British pound initially rallied against the Japanese yen during trading on Wednesday but continues to struggle to break out to the upside. Because of this, I do believe that it is probably only a matter of time before we get some type of short-term pullback. Nonetheless, this is a market that is trying to break out and the Japanese yen has been on its back foot for a while. The caveat with this pair is that it is highly correlated to risk appetite, and therefore one would think that you will have to watch other assets as well.
GBP/JPY Video 06.05.21
Underneath, the ¥150 level is significant support based upon psychology, and of course the 50 day EMA sits right there as well, so that will attract a certain amount of attention. The market is going to be choppy regardless, so at this point time there is no reason to get huge in this market, but it certainly looks as if we are trying to make a decision as to whether or not we can build down enough momentum to go much higher. If we can break above the ¥153.50 level, then the market is likely to go looking towards the ¥155 level.
On the other hand, if we were to break down below the 50 day EMA it could very well reach down towards the ¥145 level which is not only a large, round, psychologically significant figure, but it also features the 200 day EMA as well. With this, I think that we are simply going to chop around back and forth while trying to figure out where to go next.
The Euro has gone back and forth during the course of the trading session on Wednesday as we continue to flirt with the 1.20 handle. This is a market that obviously will be very noisy in general, as we are waiting to see the jobs number on Friday determine the next risk appetite situation appears. In that scenario, and the fact that the 50 day EMA sits just below I think that we are probably going to kill time over the next couple of days, simply grinding back and forth instead of making any major move. This being the case, I would anticipate that this market is going to be very boring over the next couple of days.
EUR/USD Video 06.05.21
That being said, if we were to break down below the 50 day EMA then it is likely that we go chasing the 200 day EMA underneath, which of course attracts a lot of attention. Ultimately, the market is going to continue to be very choppy overall, and I do think that what we are looking at is a market that is probably a short range bound trading type of opportunity if that. On the other hand, if we break above the 1.2050 level, then it is possible that the market could go looking towards the 1.2050 level above.
All things being equal, I do not really have any interest in this area, so am waiting to see whether we get some type of momentum that we can follow. If we do not, then I will simply stand on the sidelines as this pair does tend to be very choppy in general.
The Australian dollar rallied again during the course of the trading session on Wednesday as we have bounced from the 50 day EMA yet again. This is a market that continues to try to work off some of the recent consolidation and decide where it is going to go next. The 50 day EMA appears to be followed closely by technical traders and has been important multiple times over the last couple of weeks. With this being the case, I do believe that we will continue to go back and forth in the short term, perhaps waiting on the jobs number on Friday.
AUD/USD Video 06.05.21
To the downside, if we were to break down below the 50 day EMA there is plenty of support underneath there near the 0.76 handle, so I think we are essentially stuck in this range. This is especially true when you look at the 0.78 level and how resistive it has been. In other words, there is so much going on in this pair that is difficult to imagine that we are going to see an easy escape. That being said, eventually there will be an impulsive candlestick that you can fall, but we do not have it yet and therefore unless you are a short-term range bound trader, you probably do not have much to do in this pair. Furthermore, there are a lot of questions about China, as it stock markets have underperformed most of its peers, showing that there is perhaps some cracks in the ice when it comes to the Chinese economy. If that is going to continue to be the case, this pair is going to struggle to break out.