USDCAD 1 HOUR CHART – LOONIE TUNES
Sometimes the CAD is referred to as the Loonie and for good reason but not this time USDCAD was trading soft even when the USD moved higher earlier today. So it should be no surprise to see it trade down when the USD turned soft.
As this chart shows, there are layers of support between 1.3620-80 that needs to break for the move down to pick up steam.
Look for a limited upside if it stays below 1.3713.
Note the key Canadian jobs report is released on Friday.
Vix futures have been sideways for 12 hours with a slight undertow in volume (short side). Dow covered calls fell off of a cliff around at session end yesterday, since there was zero impetus the odds were stacked that stocks would catch a bid today. That said there is already an increase in underlying puts to a slight extent which could assist in putting a cap in the gains. I like your 106 DXY notation earlier Jay. Result with consideration to many other things could end up being some bit of a continuation in risk appetite only to be followed by an offered scenario in risk coming up I think. Hence why I am already scaling in the long side of USD from below.
If the mood changes I switch, that simple.
XAUUSD 4 HOUR CHART –
I was not even looking at gold until I saw commodity currencies rallying and this chart tells it all.
The failure to establish below 2300 has seen a pop that faces a resistance at 2332, If broken then 2352 becomes the target.
On the downside, XAUUSD keeps a bid as long as it stays above 2323.
USDJPY 4 HOUR CHART – WARY OF THE BOJ
USDJPY has slipped into the background as the market seems wary of provoking the BoJ.
As I noted, the BoJ pays attention to the same technicals we do and in this regard will try to keep USDJPY below 156.28.
On the upside, USDJOY trades with a better bid while above 155 so currently trapped between 155.00-156.28.
Word of caution… be wary of an intervention surprise on a thin Friday but if I was the BoJ I would not be in a rush to intervene again with USDJ
US weekly jobless claims rise more than expected
Yields dip, USD dips, stocks pop
Note this is not the BLS survey week
EURGBP 4 HOUR CHART – Watch .8600
Looking at this chart, technicals are still pointed up but the range is .8581-.8619, with .8600 as the midpoint.
For me this suggests using .8600 as a barometer of GBP strength (relative term) or weakness.
On the upside, a firm break above .8620 would put the major,8744 level in play.
On the downside, a firm break of .8580 would suggest the high is in for now and cooling pressure on GBPUSD.
Likely see support on dips while above .8581.
GBPUSD 4 HIUR CHART
Break off 1.2466 has so far been unable to reach 1.2422-40. The significance of these levels is below it would open the floodgates on the downside (major support is at 1.2298).
Otherwise, there are two pivotal levels
1.2500-05 on top
and
1.2450 (Power of 50 level) for intra-day trading bias (currently back above it)
As I noted, also loom at EURGBP as an indicator of GBP weakness or noit.
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