USD/CAD
The US dollar initially rallied against the Canadian dollar during the week but has since turned around to show signs of hesitation. This is not a huge surprise considering that we have been bouncing around in the same region for 5 weeks now. It is worth noting that the 1.3550 level below is a significant floor in the market. To the upside, the 1.3750 level above is a potential barrier.
So really, if you are a longer-term trader, you are waiting to see whether we break in 1 direction or the other. Short-term traders will probably continue to push this thing back and forth as the interest rate differential is tightening up between the 2 currencies.
EUR/USD
The euro has been very choppy and sideways during the week as it is a very situation as the US dollar against the Canadian dollar. Quite frankly, the interest rate differential is not that much, and we know that the European Central Bank is likely to stay very flat with its interest rates and the Federal Reserve is possibly going to be cutting rates.
In that environment, you have a situation where traders are looking to find some type of reason to move in 1 direction or the other. Right now, I think the only thing that you can think of is that maybe the 1.18 level continues to be a bit of a magnet for price.
USD/MXN
The US dollar rallied against the Mexican peso for the week, but that is not a huge surprise considering we had fallen so drastically. If we were to rally to the upside, the 17.50 level is an area I would be looking for selling pressure to start shorting.
It is not until we break above the 18 level that I will start to contemplate a trend change. The interest rate differential favors the downside, so as a general rule, I tend to use it as a way to collect swap. I do not buy this pair very often, but it can rip to the upside and be very lucrative. You just need momentum, basically some type of fear typically because of the interest rate differential.
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BTC/USD
Bitcoin has been very noisy during the week and continues to watch the $60,000 level. The $60,000 level is an area that a lot of people will be watching because if we break through there, I think it opens up a door to the $50,000 level pretty quickly.
Upside Potential and Grinding Sideways
A move above the $72,000 level opens up the possibility of a move to the $84,000 level. But right now, I think more than anything else, you have a situation where Bitcoin is just going to grind sideways and quite frankly, the longer it does that, the better off it is going to be.
USD/JPY
The US dollar has rallied a bit during the course of the week against the Japanese yen as the 158-yen level continues to be a barrier. Ultimately, I think you have a situation where traders are looking for some type of reason to break above the crucial 160-yen level.
If we can break above there, then it opens up the possibility of a massive move as the area is the swing high from 1990. Short-term pullbacks I think continue to be buying opportunities based on interest rate differentials and the fact that the Japanese are stuck with debt that they cannot finance at large levels.
DAX
The German index has been all over the place as the DAX is somewhat quiet, but I continue to watch the 25,000-euro level. The 25,000-euro level is a large round psychologically significant figure, and I do think that short-term pullbacks continue to be buying opportunities.
The market opens up the possibility of an attempt to try to break above the 25,400 level. If we can break above there, then it opens up the possibility of a move to the 27,000-euro level. I have no interest in shorting the DAX. I think the German economy continues to benefit from serious stimulus coming out of the government.
NASDAQ 100
The Nasdaq 100 has been all over the place for the week and despite the fact that we have had a lot of headaches out there, and some of the biggest names like Nvidia have been hammered, it is going to finish the week relatively stable. We continue to watch the 25,000 level as that is a large round psychologically significant figure.
If we can break above there, then it is likely that the 25,500 level is a situation where you would see a bit of a barrier. Ultimately, I do think this thing continues to go higher and short-term dips offer opportunities.
The US dollar continues to fall a bit during the past week against the Swiss franc and at this point in time we have to watch this pair very closely.
USD/CHF
The US dollar continues to fall a bit during the past week against the Swiss franc and at this point in time we have to watch this pair very closely because quite frankly, the Swiss have been complaining about the strengthening Swiss franc.
The 0.76 level is a bit of a floor. We will see if it holds. If it does not, then the 0.75 level gets targeted. Eventually, I do believe that the Swiss National Bank gets involved and intervenes, but it probably starts in the euro against the Swiss franc, not necessarily this pair.
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