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WTI Crude Oil (US Oil)
The crude oil market has fallen a bit during the course of the week, but we continue to be held hostage to the noise in the Middle East. With that being the case, the market is likely going to continue to see the $90 level above as a major resistance barrier. If we can break above the $90 level, then it’s possible that the market could go look into the $95 level. Underneath, the 50-Week EMA of course is something that could offer support.
Gold
I feel like I’ve been chasing gold back and forth all week, as we continue to see the market looking at the $2000 level as a major resistance barrier. If we can break above there, then it’s possible that the market could go toward the $2050 level. Having said that, gold is moving almost purely on the bond market and the Middle East tensions. The bond market has broken over the 5% barrier in the 10 year yield yet again, which works against gold, but the problems in the Middle East continue to push gold higher. Expect massive amounts of volatility, and much like the oil market, you are looking at the market reacting to the latest headline.
EUR/USD
The euro ended up forming a bit of an inverted hammer for the week as we continued to bounce around in a bearish flag. All things being equal, this is a market that I do think continues to go lower, but we need to break down below the 1.05 level in order to continue to pick up downward momentum. With all of the “risk off behavior” out there potentially coming, I think it’s more likely than not. Rallies continue to be sold into from everything that I can see.
GBP/USD
The British pound initially tried to rally during the course of the week but gave back gains near the crucial 1.2350 level yet again. At this point, it looks like the British pound is likely to continue seeing downward pressure, and we could drop down to the 1.1850 level. Looking forward, I think that the 1.2350 level is a major resistance barrier, and if we can break down below the 1.20 level, it does open up the move down to the 1.1850 level. At this point, the US dollar makes the most sense out of all of the major currencies to own.
USD/JPY
The US dollar has initially tried to rally during the course of the week against the Japanese yen but has also found a lot of noise near the ¥150 level. By turning around and forming a bit of a shooting star, this suggests that perhaps we are not ready to break out. I think we will continue to consolidate overall, and as long as we can stay above the 147.75 region, I think we will just continue to grind sideways and work off some of the excess froth in the market.
USD/CAD
The US dollar has rallied significantly against the Canadian dollar, busting through the 1.38 level that I had mentioned last week, now that we are above there, we are going to challenge the 1.40 level. The 1.40 level being broken to the upside would open up the possibility of a much bigger move. With this, I remain bullish, but if we were to turn around and break below the 1.36 level, then you would have to look at this as a failed breakout.
NASDAQ 100
The NASDAQ 100 has rallied initially during the course of the trading week but finds the area above the 14,500 level as a bit too much to overcome. Because of this, I think the market is now going to threaten the 50-Week EMA, and then perhaps the 13,750 level, an area that previously was resistance. All things being equal, this is a market that is continuing to accelerate to the downside, so we could see quite a bit of negative pressure as we are navigating the Q3 earnings season, and of course all of the war going on around the world at the moment.
USD/MXN
The US dollar has gone back and forth against the Mexican peso again during the course of the week, testing the 18.50 MXN level. If we were to break above that area, the US dollar is ready to fly. At that point, I would anticipate that the greenback goes looking to the 200-Day EMA, closer to the 19.20 MXN region. On the other hand, if we turn around and break down below the low from 2 weeks ago at the 17.80 MXN level, then we would see the market drop.
