Gold
Everybody in the world is watching the precious metals markets at the moment, and gold, of course, continues to attract a lot of interest. Quite frankly, I’ve had a bit of a problem this week trying to catch short-term dips and take advantage of the overall trend. With this being the case, you should pay attention to the $4400 level because it’s been an area that buyers have defended a couple of times over the past 3 or 4 weeks. I do believe that we are eventually going higher in the gold market before it’s all said and done, with a potential target of $4900 based on the “measured move” of the ascending triangle.
EUR/GBP
The euro fell significantly over the course of the week but is trying to find a little bit of support near the 0.8650 level. The interest rate differential continues to favor the United Kingdom, and despite the fact that the Bank of England is likely to cut rates in the future, they are being very slow and stubborn about it, while the European Central Bank is essentially on the sidelines. This could favor a bit of a downtrend in this market, and I’m looking at short-term rallies as potential selling opportunities.
Silver
Silver rallied again during the week as we continue to threaten a major breakout above the $80 level. At this point, I think any time this market dips, there will be buyers willing to get involved. This is a market that is going through a lot of volatility, mainly based on the idea that there is a lack of physical supply. At this point, $70 is a bit of a floor. As long as we can stay above there, short-term traders will continue to defend any selloffs, as the uptrend remains very strong.
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WTI Crude Oil
The light Sweet Crude Oil market initially fell during the week, but spent quite a bit of energy recovering, and it now looks as if it is trying to make its way toward the $60 level. The $60 level is a large, round, psychologically significant figure and an area where I think a lot of selling pressure could reenter the market. We are in a downtrend for a reason, not the least of which will be the fact that demand is so weak at the moment while supply is so strong.
EUR/USD
The euro has fallen pretty significantly during the course of the week, as it looks like we are going to stay within the consolidation range. This is interesting because the Non-Foreign Payroll announcement in the United States was weaker than anticipated, but the US dollar is starting to pick up strength yet again. Ultimately, I think this just reestablishes the idea that we are going to be range-bound for the foreseeable future. The 1.18 level is a major ceiling, while the 1.14 level underneath is a major floor. More likely than not, this will be the domain of short-term traders for the foreseeable future.
GBP/USD
The British pound initially rallied for the week but has turned out rather sour over the course of the last couple of days. Ultimately, it looks like there is a lot of resistance above the 1.35 level, and if we break down below the 1.34 level, we may have momentum to the downside again, perhaps sending the British pound back down to the 1.32 level. It would take a break of the 1.36 level to continue momentum and send this market higher. As things stand right now, the best-case scenario for the British pound might be consolidation.
NASDAQ 100
The NASDAQ 100 rallied again during the week to continue the overall consolidation. It still looks like the 26,000 level is going to be a major barrier, but if and when we can finally break above there, I think you have a real shot at the market truly taking off to the upside, perhaps aiming for 27,500 initially. Short-term pullbacks continue to be buying opportunities, with the 25,000 level being a bit of a floor as things stand right now. I have no interest in shorting this market and believe that now that we have gotten through the first jobs report, it’s likely that we will see continued upside.
USD/MXN
The US dollar rallied against the Mexican peso during the week, but continues to see quite a bit of resistance above. The 18 MXN level is an area that I think will be difficult to overcome, and even if we did, I find it very difficult to see the US dollar rally beyond the 18.5 MXN level, and I will continue to favor the interest rate differential being positive for Mexico, and signs of exhaustion to start shorting again.
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