S&P 500 is testing major resistance on the monthly charts

23. June 2015 · Write a comment · Categories: EDGE Chart of the Day · Tags: ,

Another trader and talented technician, Nicolas Chéron tweeted a chart of the SPX earlier today, which prompted me to look at the major Fib extensions of the market. What you will notice is that we have extended to (within 4 points) of the highs (2007 pre financial crisis) to the lows (2009 post financial crisis). In addition to this move higher the last year, the Relative Strength Index (RSI) is also diverging lower, which suggests the last year move the strength of the move is somewhat waning. Also note, in Nicolas’s chart, he is using the MACD which is looking to roll over too. See below:

6-23-15SPX

I’d like to think the market is waiting for a positive outcome (can kicking exhibition) of the Greek crisis, which could take the market to new highs. With the 161% extension just above the highs by a few points, I wouldn’t be surprised with a small false breakout first, before some profit taking kicks in.

 

Blake Morrow

Chief Currency Strategist, Wizetrade

 

Disclaimer: I have no position in the SPX and do not plan on it within the coming sessions.

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Guppy Touching Resistance from 2008 – GBP/JPY

15. June 2015 · Write a comment · Categories: EDGE Chart of the Day · Tags: , ,

The GBP/JPY (AKA the Guppy) probed previous weekly support dating back to March of 2008. But if you look a little closer, we are also probing the 161% Fibonacci extension from the 2009 highs to 2011 lows. See below:

6-15-15GBPJPY

If you look even CLOSER what you will notice is that we also just overshot (slightly) the 161% extension of the February highs to the April lows:

6-15-15GBPJPY1

The GBP/JPY is facing some very strong resistance and may be due to pullback from current levels.

 

Blake Morrow

Chief Currency Strategist, Wizetrade

 

Disclaimer: I am establishing a short position at current levels today

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Copper is Consolidating in Break Down Territory

03. June 2015 · Write a comment · Categories: EDGE Chart of the Day · Tags: , ,

A trader I follow, @faaaal , brought to my attention the pivotal level that Copper is at. I found the daily chart to be particularly interesting as we are consolidating below the daily triangle breakdown point. You can see the longer term here:

6-3-15HG

If you focus in a little closer, this is what you see:

6-3-15HG1

I don’t trade copper, but I do trade the AUD currency, which tends to be influenced by copper from time to time. Currently, I am long the AUD on a cross, so I will be watching copper very closely.

 

Blake Morrow

Chief Currency Strategist, Wizetrade

 

Disclaimer: I have no position in copper and do not plan to in the coming days.

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AUD/NZD Poised to Challenge Long Term Trend Line

02. June 2015 · Write a comment · Categories: EDGE Chart of the Day · Tags: , ,

The AUD/NZD is poised to break higher. Not only is the downtrend line (about 1.0850) about to be challenged, but the pair has also developed a “bull flag” pattern and looks poised to move towards the 1.1450 level (also major retracement level) in the coming weeks. In addition, the recent pullback to 1.0575 was a shallow 38.2% Fibonacci retracement (not shown). Take a look at the chart below:

6-2-15AUDNZD

 

Blake Morrow

Chief Currency Strategist, Wizetrade

 

Disclaimer: I have been establishing a long AUD/NZD and will be adding to the position in the coming days.

 

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USD/CAD False Breakdown at Range Lows Could Create a Short Squeeze

13. May 2015 · Write a comment · Categories: EDGE Chart of the Day · Tags: ,

The USD/CAD reached range extension lows (and 38.2% Fibonacci support of June 2014 lows to March 2015 highs) and made a brief new lows before reversing after crude oil futures tumbled today following the inventories numbers. With the USD oversold on a 4 hour chart, the USD/CAD may be primed for a bounce back from current levels. Here is the chart:

5-13-15USDCAD

Blake Morrow

Chief Currency Strategist, Wizetrade

 

Disclaimer: I have held a long USD/CAD trade for the last 2 weeks

 

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GBP/NZD Weekly Inverted H&S Pattern Points to Almost 3000 Pips Higher!

11. May 2015 · Write a comment · Categories: EDGE Chart of the Day · Tags: , ,

If the long term (4+ year in development) Inverted Head and Shoulder Pattern plays out, the move could be nearly 3000 pips. This has been a highly anticipated move (by me and many others) for the last several months. We have attempted to break the neckline at 2.1050 a could times Today if finally happened. I suspect it is a combination of the UK election results and the Tory party claiming a majority in last week’s elections, and the fact that some local New Zealand banks are now seeing the possibility of rate cuts in the coming months. Also keep in mind, in 2014 the markets were pricing in over 2% of hikes, and the RBNZ only delivered 1% before stalling its rate hie cycle.

Here is the chart:

5-11-15GBPNZD1

 

Blake Morrow

Chief Currency Strategist, Wizetrade

 

Disclaimer: I have been long the GBP/NZD for the last 2 weeks and am adding to my long position currently

 

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Traders expecting the USD/MXN to trade like the USD/CAD may be disappointed

30. April 2015 · Write a comment · Categories: EDGE Chart of the Day · Tags: , ,

Wen you take 2 North American currencies like the CAD and MXN, you can see the tight correlation. But what has happened in the USD/CAD is we have seen a strong depreciation of the pair as crude oil prices have rebounded. On the other hand, the USD/MXN has barely pulled back as the USD/CAD has corrected. Matter of fact, the USD/MXN is within striking distance of it’s multi-year highs.

Banxico meets today, and the market doesn’t expect much change from the CB. Last week, Governor Carstens said the central bank is weighing the weak economy’s need for low interest rates and to divert pressures if the Fed decides to hike rates. Those types of dovish comments could push the USD/MXN higher in the near term. Or, if the USD starts to bounce against other major currencies, that could be the catalyst to drive the USD/MXN back to the highs as well.

4-30-15MXNCAD

 

Blake Morrow

Chief Currency Strategist, Wizetrade

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BOC Poloz tries to talk down the CAD as the USD/CAD hits major support

28. April 2015 · Write a comment · Categories: EDGE Chart of the Day · Tags: ,

Comments this morning from the Band of Canada came out this morning during a testimony in Ottawa, but the one comment resonating with traders is “a lower CAD is ‘absolutely’ a net benefit.” This comment (amongst others) has helped the USD/CAD bounce from a key support today. Take a look:

4-28-15USDCAD1

The 4 hour chart was showing a divergent relative strength ahead of the testimony as we approached the 161% extension of the recent range.

4-28-15USDCAD2

After the breathtaking move higher in the pair over the last year, and the lows from 2001, we have hit some major fib level confluence near the 1.2000 level.

 

Blake Morrow

Chief Currency Strategist, Wizetrade

 

Disclaimer: I did initiate a long USD/CAD trade today ahead of the BOC Governor’s testimony

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Looking for a bounce in the US Dollar Index – DXY

27. April 2015 · Write a comment · Categories: EDGE Chart of the Day · Tags: , ,

The USD has been range bound the last 1+ months, and I am now starting to look for an area for a bounce, or strategic place to enter US Dollar longs. Here is what I see:

4-27-15DXY

The USD index is pushing channel lows, but the 23.6% Fibonacci retracement level comes in at the wedge breakout point (95.30) from the beginning of March. Also, it looks like a channel is forming that coincides with that breakout point near 95.30 level as well.

 

Blake Morrow

Chief Currency Strategist, Wizetrade

 

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GBP/USD at an Inflection Point

24. April 2015 · Write a comment · Categories: EDGE Chart of the Day

The GBP/USD has rallied sharply into some critical technical resistance. A break above 1.5200 would be bullish, but as long as we hold below, the channel is in play. See Below:

4-24-15GBPUSD

 

Blake Morrow

Chief Currency Strategist, Wizetrade

 

Disclaimer: I just entered a GBP/USD short based on this chart. However, if it breaks 1.5200 on a sustained basis I will likely cover the short for a loss.

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