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Currency Pair Overview:
Markets Moving Slowly in Asia
Overall, the major pairs opened the session showing slight dollar strength. However the strength was short-lived as the pairs close the gaps from the weekend. Most of the major pairs are still trading near all time highs against the dollar. The Australian producer price index was released today with a reading of 0.1 percent which is lower than the expected 0.3 percent.
The euro (EUR/USD 1.4995) opened the new trading week 13 pips lower denoting dollar strength over the weekend. The pair has been trading below the neutral swing point at 1.5015 while finding slight support in the 1.4985 area. More support will be seen in the 1.4950 area which coincides with the S2 swing level while resistance remains at the 1.5060 level.
The pound (GBP/USD 1.6260) after an amazing 380 Pip dropped on Friday the pound had a minor 10 Pip gap which was quickly closed at the start of the new trading week. The pair found slight support at the 1.6290 level which is just above the 50 day moving average. The first resistance point for the pair will be the 100 day moving average at the 1.6360 level.
The aussie (AUD/USD 0.9220) quickly found support at the 0.9195 level during the Asian session. The pair opened the session below the neutral swing point at 0.9240 and will likely find that area to be a minor resistance point, the next major resistance area for the pair will be in the 0.9330 area which is the high from the past few trading sessions.
The cad (USD/CAD 1.0532) is finding support at the neutral swing point at 1.0505 after failing to break above the 20 day moving average on Friday of last week. During the session the pair has been oscillating around the 20 day moving average but is not broken decisively in either direction. Should the cad continue weakening the pair will hit a resistance level at 1.0585 while support for the pair lies at 1.0445 and 1.0380.
The swissy (USD/CHF 1.0088) is currently using the neutral swing point at 1.0075 as support during the Asian session. The swissy is a pair that has been strengthening dramatically. The pair has put in a level of support at 1.0030 over the past few sessions and has broken the pair would quickly be at parity with the US dollar.
The yen (USD/JPY 92.03) broke above the 50 day moving average on Friday to test the 92.15 level. During the Asian session the pair is again testing the highs made on Friday. Slight support is been seen at 91.91 or also be support seen at the 91.50 level. Meanwhile the next major resistance level for the pair will be in the 92.50 area and again at the 93.30 level which is near the 100 day moving average.
TheLFB Charting: Gold Elliott Wave view
4 Hour chart trend: Long. Main price points: 1043, and 1070. Looking for: Wave 4)
Gold is very choppy as it trades just below the 1070 highs, which means that lower wave C is still possible. The wave A support still needs to be taken out for a wave C confirmation. Until that happens, traders must be careful with any short positions, as the market may easily hit new highs in the red wave 3) before wave 4) falls lower.
This count remains valid so long as the market trades below the 1070 top.TheLFB Charting: S&P Futures Elliott Wave view
4 Hour chart trend: Long. Main price points: 1062.50, 1098 and 1115-1120. Looking for: Wave 5) top
S&P futures came back up, near to 1098.50 top over the past few sessions, in response to the impact of earning reports. S&P futures did not break through the 1062.50 lows, so traders may still see some up-side pressure over the next few trading days, before the bull market may technically complete.
As such, TheLFB team is also watching the alternative wave count labelled as wave W-X-Y, which will become the primary wave count if the 1098.50 top is taken out. In this case, the market will probably trade up, near to 1115-1120 resistance zone.
TheLFB Charting: EUR/USD Elliott Wave view
4 Hour chart trend: Long. Main price points: 1.4816, and 1.5050-1.5100. Looking for: Wave 5)
EUR/USD has reached the 1.5050 target zone for the second time over the past two days, after the earlier bounce from wave IV low, as covered recently. As such, the long red wave V may not be completed, especially if the resistance zone between 1.5050-1.5100 is taken out. In this case, traders may look for another push into the bew highs, near the second Fibonacci resistance area, shown around 1.5150.
Any break of the wave IV lows, will signal that the top was made.