EUR/USD
The euro has rallied rather significantly during the course of the trading week, as it is now threatening the 1.05 level. That being said, this is a market that had been a bit oversold so it’s not a huge surprise to see this bounce. All things being equal, the market is likely to see questions asked about the interest rate differential again, and I do think that given enough time we will see signs of exhaustion that we can start selling again. I don’t have any interest in buying the euro, at least not until we break above the 1.06 level on a daily close.
USD/CAD
The US dollar has fallen a bit against the Canadian dollar during the week, but with that being said, we are still very much in a scenario where we have been seeing a lot of movement based upon the issues and the Canadian government, and I think that will continue to be a major problem. That being said, I like the idea of buying this pair on dips, as it offers value in the US dollar, which is still fundamentally stronger than most other currencies, and most certainly the Canadian dollar.
USD/JPY
The US dollar has fallen a little bit during the course of the trading week against the Japanese yen, but it looks as if we are seen quite a bit of support at the ¥155 level. The ¥155 level of course is an area that’s been important multiple times, and the fact that the Bank of Japan has come and gone gives me a little bit more confidence in the upside when it comes to this currency pair, but I think we probably have to spend a bit of time going sideways. If we can break above the ¥158 level, then I think it’s likely that the market participants will continue to push this pair toward the ¥160 level. If we were to break down below the ¥155 level, then it’s possible that we could drop a bit from there.
NASDAQ 100
The NASDAQ 100 has been bullish again during the week, as people are looking at this through the prism of a market that’s about to make an all-time high again. I don’t necessarily think it’s going to be the easiest thing to do, but short-term pullbacks should continue to attract inflows, as the NASDAQ 100 will continue to benefit from the pro-business trump administration, and at this point in time, just simple momentum.
DAX
The German index continues to rip to the upside, as we are well above the €21,000 level. At this point, the market desperately needs some type of pullback, but you cannot look at that as anything other than a potential buying opportunity, because shorting the DAX at this point in time would be tantamount to throwing money out the window. At this point, the €20,000 level should end up being a major floor in the market, as it is a large, round, psychologically significant figure, and an area that I think a lot of people will be watching closely.
Silver
Silver has been noisy during the week, but did manage to eek out some gains as we continue to bounce around between the $30 level at the bottom, and the $31 level at the top. If we can break above the $31 level, it is possible that silver will rally from here, but at this point in time I much more comfortable owning gold that I am silver, as silver has to worry about tariffs and sluggish economic momentum due to the inevitable fights that we are about to see.
Crude Oil
The Light Sweet Crude Oil market, or the West Texas Intermediate Crude Oil market, has fallen during the week, but it still is very much in a trading range, and I think at this point in time you have a scenario where traders are looking for value to take advantage of. I have no interest in shorting this market, and I do think that given enough time we could see this market break above the $70.50 level, which would be the next sign that we are about to take off to the upside. With central banks around the world cutting rates and economic growth in the United States rather robust, it does make sense that oil would continue to go higher.
Gold
Gold markets have rallied rather significantly during the course of the week, and as I write this, it looks like we are about to break out to a new all-time high. If we can clear the $2800 level, that will allow gold to go looking to the $3000 level over the longer term. I have no interest in shorting this market, and recognize that any pullback should be thought of as a potential buying opportunity and one of the more bullish markets that I follow.
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