Gold
The gold market rallied a bit during the course of the trading week as we find ourselves above the $4,600 level again. Friday was of course Good Friday, so we had only a 4-day week, but ultimately this is a situation where traders are looking at this through the prism of risk appetite and of course rates.
The interest rates out there continue to be a bit of an issue for gold, and I think that could continue to be the case, but it does look like we are trying to turn things around. The market forming a perfect hammer during the previous week from the 50-week EMA is a technically beautiful buy signal.
But we need help from interest rates, and we need them to drop. I am personally keeping an eye on the 10-year yield; if it is below the 4.30 level, I believe at that point gold should do fairly well.
Silver
Silver is very much in the same boat here as we are above the $70 level, but it too is very sensitive to interest rates and what they are doing. The 10-year yield again is what I am watching here, with the 4.30% level being one that I am watching very closely and waiting to see whether or not we can get below there and sustain below there.
At that point, I suspect that silver will really start to shine and have its day. Short-term pullbacks should continue to be buying opportunities, and the $70 level is an area that I am watching very closely at as support.
EUR/USD
The euro has gone back and forth during the trading week, and we essentially have found ourselves hanging around the middle of the overall range. If the market were to break down from here, the 1.14 level should be supported, with the 1.1650 level above being resistant.
Ultimately, I think this is a scenario where traders will continue to be very cognizant of what the interest rate differential is between the United States and particularly Germany, but the EU on the whole, and of course what the situation is in the Middle East. If the Middle East calms down, that should help the euro and vice versa.
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Bitcoin
The Bitcoin market has been slightly positive for the week, but we continue to see a lot of noise at the moment, and I think you have to look at this through the prism of a market that is still doing everything it can to build up some type of base.
I also recognize that it is a market that you are going to have to be very patient with. If we can break above the $72,000 level, that would be a very good sign.
USD/JPY
The US dollar initially fell against the Japanese yen for the trading week but found a bit of support as we continue to see the interest rate differential continue to be a major driver in this pair. The market initially pulled back just a bit over the last couple of weeks only to find plenty of buyers.
The fact that we have formed 3 hammers in a row suggests that the US dollar is in fact squeezing the Japanese yen to the upside.
The 160¥ level continues to be an area of rather important resistance that I think extends to the 160.40 level. Breaking above there frees this market to go much higher.
USD/MXN
The US dollar pulled back against the Mexican peso, but it is still grinding along its path. The question is now that we have a bit of a pullback, will the buyers return or will this thing break down?
I lay this solely at the feet of interest rates and how interest rates behave in the United States, so we will see how that plays out. But I do prefer shorting this pair over buying it.
If we get more of a risk-on type of move, then we have the possibility of a drift towards the 17.50 level. If we break to the upside, we could go as high as 18.50.
USD/CAD
The US dollar rallied against the Canadian dollar again on the past week and it looks like we are trying to get to the 1.40 level. That being said, there is a lot of resistance in this area, so I am a little hesitant to get overly aggressive here.
I believe that pullbacks continue to offer buying opportunities as the interest rate differential must certainly favor the US dollar.
It is a little overdone, so a red week might actually be good news.
Nasdaq 100
The Nasdaq 100 has formed a rather bullish candlestick over the last 4 days. Remember, Friday was Good Friday, so therefore the market was closed. If things are relatively calm over the weekend, we could see a situation where Nasdaq continues to recover.
I certainly think there is a lot of interest there and there are a lot of people looking to buy stocks. The question now is whether or not the momentum will keep up.
I am bullish of this market; short-term pullbacks should be buying opportunities as, even though it sold off, considering that the United States is at war with Iran, it’s held up quite well.
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