US Stock market / Gold cycles 1850 - 2013
US Stock market / Gold cycles and bank failures 1928 - 2024
The benefit from AUD/JPY is, that you can do carry trade there. For people who still do not know what carry trade is, or how we can use it with forex, explanation follow.
The interest rate in Japan is 0.5 %. You selling JPY @ 0.5 % and buying AUD. I am not sure what is the interest rate in Australia, but is 6 or 7%. And because you buying AUD, you receive those %%% each day, and paying just 0.5%. Difference come to your account.
All this is done automaticly from your broker.
So lets begin :-)
First the AUD/JPY weekly chart.
We have long term support @ 100.
Daily chart AUD/JPY:
I expected the price to drop to 103 and to find support there. Looks like the support is broken. Beside support @ 100, we have support @ ~101, and 97.
Daily chart USD/JPY:
We have very nice channel here @ ~121. Price must fall to the bottom of the channel, then to go up.
We have double top forming. Note the second top, is not as high as first - this is very important.
Look at the high volume this Friday, is quite huge. We had no such volume from March.2007 "chinese/yenn" fall.
Because I love channels, I think there is a week support @ ~12,900. Then support is @ 12,500 ; 12,100. In case we see 12,000 we will have bear in the house.
Many analysts believe EUR should fall now again, before the final raise to 1.36-1.40.
Generally I do not see this possibility, but lets see this week view.
I. Wedge watch in USD index.
We will begin with the weekly USD index chart. USD began to fall to the support. There are still much more to go until level of 81.
Daily USD index chart, show that actually US is in upside channel (brown), and is close to the support level. It is possible USD to bounce from the support (brown), and to raise to the 83 level again, where the resistance from the wedge is (blue). After then the big fall of USD may start.
This is just a possibility. In any case, the USD will fall soon or later. Time frame - 1-2 mo.
II. Triangle watch in EUR/USD.
Now, EUR/USD. 2 days chart.
We have a triangle, made from long term support (not shown, but is from 1 week EUR/USD chart). We are on the top (resistance) on the triangle. It must be broken now, or next time around.
In case is broken now, a move to 1.3660 will follow, and then to 1.40... who knows :)
In case is not broken, a fall to ~1.33, which will be good entering point, and then the raise to 1.3660 will begin.
8 hour chart show that the raise of EUR/USD may continue a little bit, but we spoke for 1.3490. Do not misunderstood - the fall will probably come, do not buy EUR/USD. In case you have open position, a floating stop will be good for you.
Finally a 30 min chart.
I added this in order to study the mid-day fall to 1.3420, and the recovery after that. I was about to buy there, but I thought a more downsize will come. Anyway, the resistance on 1.3466 worked, so the recovery were to the same place where mid-day high was.
We need to watch how the EUR/USD will open Monday.
Technical picture suggest USD will raise to ~1.33 , but not that much, and after that a sharp fall will occur to 1.3660.
I will *NOT* short EUR.
I do not feel well when I do that and next day Helicopter Ben print some new money :)
Happy week and good trading :-)
Now we will look to entry point again at EUR/USD level ~ 1.3430 or less (but probably we will use GBP/USD because not to pay carry interest)
If the triangle get broken, an explosive rally will lead to 1.3650 at first time, and then to 1.38 or even stellar 1.40
8 hours chart - we are inside the channel again. The upper boundary of the channel is the boundary of the triangle too. Since boundary declining, we are getting closer any day. Reward will come soon :-)
Delta Stock who are my broker, and I respect their opinion thinks a fall to 1.3220 will happen. I can not see this scenario. The maximum fall I see is ~1.33, but I do not think this will happen.
Today we celebrate 50 years from the beginning of the "made" of Trabant - the DDR's (East Germany) "Mercedes" :-)
I used to have car like this, also combi, but blue.
Hmmm co-incidence or market crash ahaid ? :-)
First 4 day chart of EUR/USD.
We have long time support and resistance. EUR bounced from the support, and now it must go to the top @ more than 1.37. This is quite long term so do not expect it "tomorrow" :)
EUR/USD 2 days chart.
We have a triangle here, its boundaryes are the long time support and resistance from the recent top last mo @ ~ 1.3670. The triangle must be broken on the top, and we must have new major top. This top may be calculated using 4 days chart, and it probably will be @ 1.38 or more.
4 hours chart,
hopefuly, the EUR/USD go back in the falling channel, and heading up. The spike I market with yellow - 1.3480 low, is the current resistance. EUR need to go upper, because else, we will need to re-do the analysis. Well I am very optimistic for this, but we will see.
When I commented the 2 days chart I said "if the triangle is broken". Well before the triangle is broken, EUR/USD must first go to ~ 1.3510
(big resistance there, so EUR may not break this time, but first we will go to ~ 1.3510)
Now lets go to our "favorite" chart. USD index.
USD index is dominated by EUR, and EUR index is dominated by USD. Thats why those two indexes are opposite like mirrored.
So, USD raised to the resistance (almost like 4 days chart of EUR/USD), and already began to fall. It will fall to the support @ 81
EUR index is same as USD index, but opposite.
Finaly, the ratio between EUR index : USD index.
Basicaly same chart as previous two, and 4 hours EUR/USD chart.
3% expected till end of the year.
Congrats to all "borrowers" and carry-traders.
Should this have impact to US stockmarket?
Probably not yet, since most of carry trade is made with Japanese Yenns.
USD raised more against Yenn too.
USD index chart is now surely on the upper boundary (chart from 2 days ago), and need to go down now to 81 level.
Long term picture is unchanged. We are closer to the support (blue line), there are one more support (brown), is sideways from March.2007.
Short term is show below. 8 hours, because 4 hours do not show full move down. The EUR falling from 01.may.2007. Until yesterday, there was good downtrend channel (blue lines). Now the channel is broken from downside. The short pink line shows where estimated is the raising long term support. The brown line show level 1.3200 (sideways from March.2007).
Currently we are on 50% retracement from the top. See fibonachi lines/levels.
I am still bullish on EUR, but we need to see some reversal soon or at least EUR must go back inside its channel. Else the analysis will be invalidated.
What a development in EUR/USD and Gold.
I can not say for others, but it was very unexpected for me, even I was sure the EUR will decline to 1.3400, or even to 1.3390.
The decline in EUR to 1.3319 and Gold to $645 sure made me panic for 2-3 hours. However, lets see the technical picture:
This week, we will begin with our favorite chart - USD index. Even Robert McHugh finaly "saw" the trendlines, and include them in his weekly report. We are now on the resistance level of the figure that looks like wedge. Now the dollar must go back to support, @ 81.
Because, the USD index is dominated by EUR, and because XEU - euro index is dominated by USD, XEU shows the chart that is mirror/inverted of USD index. Wedge again, and EUR is near the support level. Now it will go up to the resistance @ ~140.
The ratio of XEU:USD show a picture similar to (inverted) USD index. I put some more trendlines there, but will not comment them.
Now, EUR/USD 1 day chart. Price is on the resistance level, on both long term raising support, and short term downtrend channel. EUR must raise. I say it will raise to 1.3520. But we will see.
8 hours chart of EUR/USD, show the downtrend channel.
It also show "small" / "false" / "momentary" break of the support - this is clear. However, we will think that the break was momentary, and the support is not broken, because there was "imediately" recovery of price to be inside the channel.
Also, the long term support may was / is broken. This is not worry me, since I am not sure where is exactly this support.
Conclusion is that there is not change in the technical view, and we will see a break on top of the triangle, and EUR/USD will go first to 1.3520 (which does not break any channel), then down, then up to 1.36-1.37-1.38...
Gold is soo much like EUR (see below). The Dollar rally is the reason Gold to decline. But unlike EUR, it does not broke any channels (yet), and we may expect recovery soon. Now is the time to add to your Gold possitions, or if you do not have any - to buy some :-)
Here I give you "collage" of XEU:USD and Gold.
Note that time frames are different - Gold is from beginning of jan.2006, but XEU:USD is from Jun.2004.
I need to think about it how important is this similarity, and probably will write about it soon.
Hmmm. We will see.
Note - I think 1.3320 is where the brown line suppose to be. My software had problems and the line is moved a little bit, but never more than 10-20 pips.
However, the EUR/USD is little bit unclear. May be I am unpassion, but we will see.
Let first see the 1 day EUR/USD chart
situation is unchanged - a triangle, but now, the long term support (blue) is higher that the short term downtrend (brown). We are on the bottom, BUT we may expect some more downsize.
Now, lets see 8 hours chart.
Here, we can see the "part" of the triangle. I expect prices now to go once again back to 1.34. This is because of downtrend channel, and because long term support was not soon tested (blue line).
Then, we will have up-down some time, because we still have wide range - 1.3390 - 1.3530.
Finaly, USD index chart - we are still in same possition as we were 2-3 weeks ago. Some more upside must occure. It need to :)
Happy week and good trade.
Soon I will prepare something nobody did before me - a ratio between Bulgarian stock index BG40 and Gold, USD index, Dow and DAX/FTSE