January is over and we have some VERY significant candle sticks that have been closed. Many of them are in currency land and they should have pretty heavy implication going forward if they are confirmed.
Many of you that have been following me know that I am Bearish Dollar, Bullish Emerging Markets, Bullish Peso, Bullish Euro, and Bearish Stocks. I have made this pretty known on both of my feeds. (Also Bullish bitcoin but that is a different story)
Let’s dive into these…
DXY – The Dollar
Looking at the monthly chart of the dollar I see a very clear reversal. The BEARS have the ball right now. The breakout failed which I have been calling for over and over again at 103 and now we are back testing 100. What happens at this 99-100 level matters. I personally want to see a slice down to 97, a bounce, and then a clean swoop through 95 down to 92, wth a test of the 200 month MA at the bottom. People think I am crazy but they also thought I was an idiot with the dollar at 103. Dollar bulls, which by the way was every wall street firm at the start of 2017, strap your seat belts on. You are going for a ride.
EURUSD – The Euro
The dollar brings me to the euro. THIS CHART IS SO BULLISH. EVERYTHING ABOUT THIS IS BULLISH EXCEPT THE MEDIA. (Presently) You currently have a bullish negative divergence with a failed breakdown on a monthly basis of multi year support. If I had to think of a better bottoming pattern trade I really can’t think of one. I have posted I want to be buying euros since 1.04 and i am pounding the table able. I love euros at these levels.
GBPUSD – The Pound
The pound today looked stronger than the other currencies. I am looking below and see a rip back up to 1.30+. This is not as good as the euro but as the dollar drops and things get better in London I am bullish pound here.
USDMXN – The Peso
I have been pounding the table on the Peso as much as I have been pounding the table on the euro. this is my second favorite chart on this post. Everyone has been so bearish the peso and I called it at 22, the Trump Top. Trump bottomed the Peso and Trump bottomed Mexico. I am expecting this to test under 20 in the near future.
USDJPY – The Yen
I am just going to put this up here because the entire US stock market is a complete YEN trade with metals and bonds and US stocks. It’s ridiculous. I don’t see how this will not at least test 110 and quite frankly if they lose it then it could go all the way back to 105. The YEN carry trade is over and I expect this to continue down.
DJIA – Dow Jones
The dow jones closed the month flat (almost went red today before the buy squad showed up). I expect to see below 19,000 in February and will reassess as the month goes on. I do not believe this is moving any higher anytime soon once this election move unwinds.
SPX – S&P 500
You cannot deny that the past 3 months have been very good to investors. I was very bullish pre election and flipped bearish in December and been bearish since. I still am bearish now. I see a very strong market that needs a break. This is going back as well. the rampathon close I am going to attribute to month end markup for now. I think this comes back and comes back hard. Your points of reference are 2245 and 2187, both of which I think are given back in February, definitely the 2245.
GLD – Gold
Gold held serve in January and now needs to get back above 1220 and HOLD IT. This needs to be held for WEEKS. I am bullish metals but this needs to happen. 1200-1220 MUST HOLD.