FX Currency update

last post on US Dollar Index: https://bartscharts.com/2021/02/22/usd-index-close-to-a-big-move-up/

well, it’s certainly getting interesting.

watch the levels shown on the GBP and the EURO and USD Index to get a feel for what might be coming this week.

IF we hold these levels then expect dollar strength .. EURO and POUND weak.

IF we FAIL on these sell patterns for the EURO and the POUND then the dollar will take a pounding and go right into the level we have been waiting for what seems like a LONG LONG time … stay tuned tonight.

personally, WAITING and have a “hunch” that the levels will fail (USD weakness) and go forth and attack the lower level shown on the USD Index which is the SAME level equal to EVERY move lower in the USD in the past 30+ years. worth waiting for … don’t you think?

EURGBP update

last EURGBP post: https://bartscharts.com/2021/04/01/eurgbp-2/

at this point, to protect a position, if you have one open, move stop to entry level at .8475.

you can see the “polarity” principle in play where the support in the spring of last year is now acting as resistance in the spring of this year …. hmmmm.

anyhoo … I’m looking for an initial target to take some off in/around 8850.

note the 38.2 and 50% retracements, largest measured move correction (dashed red line) and he polarity principle again but this time highlighted by a darker/bolder red. why? this level held as support for MONTHS and when it finally gave away, it gave away big …

note, depending on the form of the correction (if it even stops here) I might be looking to add on a pullback into the 8550-8600 area.

Pound … almost time? UPDATE to the UPDATED and UPDATED 10/22/2017

10/22/2017 – pound smacked into a wall of China resistance area.  this one is tough … as you can see below, we did NOT work the triangle correctly and the rally continued into the polarity zone.  the reason it’s tough is because of the very nice and basic time cycle shown below.  it’s almost perfect and, for roughly 30 years, this cycle has caused the pound to explode higher … the ‘middle cycle’ in the time of 2000-2002 based for a while before exploding.  so, do you trust POLARITY of the CYCLE?  Call me crazy but I’m in favor of the cycle for now and will be looking for a BUY opportunity over the coming weeks/months as the ENTIRE WORLD has stops right above the Polarity Wall of China resistance area ….I’ll just try to look for a pattern.

it will work or it won’t … a very interesting time indeed.

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03/22/2017 – Pound carving out a triangle and then a dump into the 1.17? Only time will tell.

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12/26/2016 – still looks like we have a little more time to go into the lows.  perhaps a little lower at the targets shown (?)

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Pound … almost time? UPDATE to the UPDATED

03/22/2017 – Pound carving out a triangle and then a dump into the 1.17? Only time will tell.

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12/26/2016 – still looks like we have a little more time to go into the lows.  perhaps a little lower at the targets shown (?)

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BREXIT – fundamentals are noise, use the charts …

06/04/2016 – fist off, Gerard, thanks for visiting the site, asking questions and watching this AMAZING development.

Folks, I honestly don’t know which way the “vote” will go but it ranks up there w/ one of the biggest deals out there.  Easily, the vote will “kick the can down the road” OR destroy the Euro-zone. It’s that simple …

this is a big deal … but PRICE and TIME tell all.  So,, here’s an updated view of the pound.  I really don’t know how to play this .. I will watch and sit on my hands as the vote is announced.  the VOLATILITY in the FX markets is going to be huge. As a sample, I’m going to show charts of the “peg” being removed on the Swiss versus Euro.  It looks so easy – but trust me, unless you have a lightning quick professional trading station – STAY AWAY.  If you look at the BIG CANDLES on this chart, you’ll see, after the carnage, there has ALWAYS been a chance to get in …

Head and Shoulders Scenario (first chart): as for me, IF (I have no idea if it’s going to happen OR not) the trend line breaks then how about a shorting a retest of 23 year long neckline?  wish I could provide more “exact” detail .. I can’t.  What we can do is see that the Pound vs USD has not closed below the neck line in 30 years.

Bullish PATTERN foldback Scenario (second chart): just follow the bouncing ball … the swings have been EXACT.

Hope this helps .. no bias, no thinking, just look at the charts and go w/ the flow ….

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Folks, this ranks up there as a “big deal” so watch this one carefully as theirs a potential the POUND busts wide open and moves 3000+ pips if we have a MONTHLY closing below the neckline.

Bart

man, I love this chart …

“should I stay or should I go …?”

check it out … the POUND is furiously getting liquidated and, well, for the global economy that ain’t good folks.

trust me, the options on FB or AMZN and blah blah can make you a lot of money but when the currencies are rolling – like they are now – it’s the shifting of the seismic plates folks.

Pound:

  • testing a 30 year trend line from 1985. Note, it caught the 1985 and 2007 plunges. Is it going to catch this one?
  • the highlighted blue rectangles show an EXACT price pattern.  they are “mirror images” of each other.
    • go RIGHT- LEFT from 2001-1993 and we go UP the blue arrow.
      • we are now folding down into the 1993 low.
        • where did it fall to?
          • the .886 retracement
    • fast forward to 2009-2016 and we go UP the same amount.
      • we are now folding down LEFT-RIGHT into the 30 year trend line, the .786 retrace and the .886 retrace
        • “one” of these should hold the pound for a powerful move.
  • remember, from failed breakout/breakdown levels come POWERFUL moves …

Let’s PLAY the IF-THEN ….

IF the pound respects one of these upcoming levels as support THEN we should get a very nice BOUNCE (800-1000 pips?)

IF the pound does NOT respect these upcoming levels as support THEN we might have another currency collapse unfolding.

Let me know if you have have any questions.

B

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Gorilla’s put dynamite down for now …reload after dollar pulls back. (the dynamite is the 4 trillion/day FX market)

Summary: perhaps, it’s my background as a Naval Aviator for 11 years.  I just read a post about “fighter pilots and organizations” and one of the points was the art of the debrief.  so, as I post “stuff” on this blog I attempt to make it all “real time” because those snap shots allow me to “adapt and overcome” (my favorite Naval Aviation saying) and see where we are in the game plan moving forward.

Cliff notes: the first target we had for the dollar index has been taken out but we have another target, shown below, that “should” cause resistance/pull back.  Folks, this thing could break wide open and explode (reference HD pattern) but I’m looking to  “enter” and will wait for a pattern to form so I can MANAGE RISK.  I will not “just enter” and put a random stop “there” …. no, I will wait and wait and wait and wait and wait till the pattern appears.  So, here’s another one below:

 

a POTENTIAL gameplan ...up to 82.40-82.50 and then BUY at/around 81.09
a POTENTIAL gameplan …up to 82.40-82.50 and then BUY at/around 81.09

Euro makes up, roughly 50%+ of the index so what is going on there ….?

EURO vs USD - finishing a 3rd for a bounce ... ?
EURO vs USD – finishing a 3rd for a bounce … ?

how about the Swissy …?

Swissy ... pattern just a little higher?
Swissy … pattern just a little higher?

how about the GBP vs USD?

GBP showing some signs of a little lower ... bounce
GBP showing some signs of a little lower … bounce

YEN vs USD …. nice little pattern up here (note NK225 yet to hit .786 and make higher highs …)

if we lose 104.43 to the upside then big potential the next move has occurred, looking for gameplan above to unfold
if we lose 104.43 to the upside then big potential the next move has occurred, looking for gameplan above to unfold

USD vs CAD — either a flat to end at 1.0850 or lower. Key is simple .. WATCH FOR 5 WAVES TO UNFOLD DOWN and then BUY at/around levels indicated for another run …

USD vs CAD
USD vs CAD

Aussie vs USD ….

AUSSIE major low ...?
AUSSIE major low …?

 

 

 

 

                                                                                                                                                                                                                                                                                                                                                             

the post below is from February 13, 2014 and I believe it’s important to rehash the most recent moves in the US Dollar. Believe this move has room to go, however,  we need to patiently wait for a corrective pattern to form.

this move in the dollar is real so try to get long in the most risk adverse manner possible.  as you can see from the post below as the 79 level was repeatedly getting tested I did, admittedly, start to question my strong dollar scenario.  that was surely one ugly level for a while but I do think the dollar will strengthen into the low 90’s target that we have been calling for.

take your time and go thru the post below …some AMAZING geometry. Also, remember, ALL of my charts are REAL TIME w/ no backward look .. they are as I saw it.

Bart

Main20140806215532 Main20140806220001 Main20140806220116

 

                                                                                                                                                                                                                                                                                                                                                               

February 13, 2014

used GOOGLE to look for a picture of Gorillas Juggling dynamite - this is the best I could find
used GOOGLE to look for a picture of Gorillas Juggling dynamite – this is the best I could find

Early in my career I had the wonderful opportunity to get training from Joe Di Napoli (www.fibnodes.com)  Highly recommend learning some of his techniques but, most importantly, his understanding of the market structure and the players in the game.  One of his favorite sayings is we must realize that “you are entering into a world where the market is truly a caged gorilla juggling dynamite and – the dynamite is lit!”

Additionally, if you have been reading this blog you’ll realize it’s focused 1) 100% on PATTERNS and 2) it’s unique value is tying PATTERNS into the circle of life (fixed income, equities, commodities, FX).  W/in the context of the circle, the gorilla is the Foreign Currency Market.  According to the Bank for International Settlements – the preliminary global results from the 2013 Triennial Central Bank Survey of Foreign Exchange and OTC Derivatives Markets Activity show that trading in foreign exchange markets averaged $5.3 trillion per day in April 2013.

The Dollar Index is somewhat important as it represents a basket of 9 currencies – the Euro representing a vast majority of it at 58%.

For all intensive purposes – it’s been “stuck” in a 4 cent range but PATTERNS suggest we are “prepping” for a big move … so, in order to get a “feel” for where we MIGHT be let’s go back to the “beginning” at 71 ish and work thru to present…

 

PATTERN at after the 71 low
PATTERN at after the 71 low

more detailed look at the mirror image foldback present in the US Dollar
more detailed look at the mirror image foldback present in the US Dollar

CLIFF NOTES: the BULLISH thesis is that after the 5 waves down from 121, a 3 wave (at a minimum) corrective pattern should ensue (A-B-C) and therefore the bounce has farther to travel.  Additionally, it could mark a MAJOR low and we are starting back up for 5 waves.  The BULLISH consensus for the US DOLLAR is that this move UP is not complete.  Please see this chart below … and, notice the EXACT move up from the PATTERN shown above at the “2 or B” level.

note a clear 5 waves down should lead, big picture, to a 3 wave move up (at a minimum)
note a clear 5 waves down should lead, big picture, to a 3 wave move up (at a minimum)

so where are we now? Without showing an “elaborate” count, we can see by the chart below that we smacked right into a “big picture” .618 price projection that had it’s genesis from the 71 price low.

.618 price projection on the US Dollar causing the resistance
.618 price projection on the US Dollar causing the resistance

here’s the possible bullish count from the “2 or B” low that shows a POTENTIAL 3rd wave underway. IF the count is correct, then the 79 level has to hold and is very crucial as it suggest that the 3rd wave should begin …soon and UP we go.

potential count showing a bull move
potential count showing a bull move

now, we need to drill down one more time frame – that of the 240 minute chart to see what we have going on.  YES, we have a BULLISH PATTERN on the US Dollar at 80.05-80.08.  In order for this entire thesis to be correct, then I believe this pattern needs to hold for the strength in the US Dollar to begin…

BULLISH BUY PATTERN PRESENT
BULLISH BUY PATTERN PRESENT]

the last BULLISH PATTERN present ...
the last BULLISH PATTERN present …

 

PATTERNS fail …they are an EDGE and over time they have been statistically proven to give us an edge.  But, what if this pattern does fail? Take a close look at the following two charts … I have not shown this before, but we need to take into account the 5 wave move down from 121 and the .618 price projection — they are starting to form a huge B wave triangle.  The 5 wave move into the low is a BIG BIG A and then current structure is forming a BEARISH TRIANGLE w/ the ‘c’ portion just completing (due to the exact nature of the .618 price projection) and ‘d’ and ‘e’ to come …also note the purple trend lines.  One forms a head and shoulders and the other is showing the support for the US Dollar since the ‘b’ wave low …

do we have a multi year bearish triangle forming?
do we have a multi year bearish triangle forming?

here’s one last thing to consider …. take note of the measured move UP move from the past and what happened after it completed … a bearish omen?

a measure move omen ?
a measure move omen ?

CLIFF NOTES:

  • w/ the deflationary forces present, the dollar SHOULD strengthen.  A well formed count supports that and a PATTERN very very close also holds that thesis as correct and positive. The first is the once completing at 80.05 on a shorter time frame and then 79.53 on the daily.  They need to hold – w/ the 79.53 as the major pattern if the bullish thesis is correct.  Remember, w/ our rules we could go all the way down to 79 again so, for all intensive purposes the 79 level is the line in the sand.  We have two symmetrical BUY patterns present …
  • HOWEVER, if we lose the 79.53 level THEN it will open up some serious selling.  PATTERNS will then shift to the B wave triangle thesis …
  • Last, we have MAJOR patterns complete across the indices and they are “acting” like the double tops that formed in 2000 and 2007. We have the Dow Jones Transports finishing a pattern from the late 1800’s, we have a potential generational low in interest rates complete and PATTERNS suggest one more wave lower in the commodities …

It’s all coming together and one of the circle of life gorilla’s is going to drop their stick of dynamite and big old explosion is going to occur …