30 Apr: Trend table outlook for FX, Commodities, Indices

By | April 30, 2019

Monday has been a fairly quiet and rangebound session and as with yesterday, a generally cautious stance is possibly wise ahead of the FOMC Meeting, due early Thursday in Asia, although ahead of that today’s China PMIs and EU Q1 GDP may create some waves. In the meantime most of the FX pairs and Stocks are pretty much unchanged, while WTI is a little higher and the metals are a touch lower. The trend table is generally pretty devoid of directional bias so I would not be looking for too much action today.

EurUsd:  has had a mildly positive Monday session but remains within the 1.1100/1.1200 range, which may well continue though Tuesday, with the EU Q1 GDP being the main event on the calendar ahead of the secondary data to come from the US, but generally waiting on Wednesday’s FOMC Meeting.  Technically, the pair has continued to recover from Friday’s new trend low at 1.1110, last seen in May 2017, and ending Monday at the session highs of 1.1186 (1.1190: 23.6% of 1.1447/1.1110). The short term momentum indicators do look positive, and a test of 1.1200 and then the 200 HMA, currently at 1.1208 may be on the cards, beyond which minor resistance lies at 1.1225, ahead of the 38.2% Fibo resistance at 1.1238. Above there, the 22 April high of 1.1262 would come into play but possibly not today.  On the other hand, the medium term charts point towards further losses ahead, but with the near term support coming in at 1.1145/50 and then again at 1.1110. Below 1.1100 would target 1.1060/65, where the base of the descending wedge should see decent bids. A downside break would then open the way to 1.1020 (minor) and to 1.1000. A rangebound session looks likely although I still think the Euro will come under pressure at some stage, so prefer to sell rallies.

 AudUsd: Having traded down to 0.6988 last Thursday, the Aud$ continues to find a near-term base in consolidating near 0.7050 at the start of the week. The short term momentum indicators still look mildly positive, and if today’s China PMIs continue the recent positive upturn in the Chinese data we could see a run towards  0.7070 (38.2% of 7206/0.6988) ahead of the chance of a run back towards 0.7100 and then to 0.7120 (100 DMA), although if seen, this would provide a decent selling opportunity, I suspect.  The medium term charts remain heavy though and eventually I think 0.7000 and the current low (0.6988) will give way for a run towards 0.6970, 0.6950 and eventually to 0.6900. I prefer to sell rallies in anticipation of the inevitable rate cut, but we may see better levels to do so. The RBA meet on Tuesday. I dont think they will cut ahead of the May 18 election, but June/July/August could be in line for some RBA action.

NzdUsd: As with AudUsd, the Kiwi has bounced strongly after making a new trend low at 0.6580 on Thursday, and currently sits at 0.6660 as it consolidates below Friday’s high at 0.6681.  Short term resistance will again be seen at current levels (0.6660 =23.6% of 0.6938/0.6580), beyond which would open the way back to 0.6680 and possibly to 0.6700. Above here would open 0.6715 (38.2%) and the 200 DMA at 0.6728, although not today I suspect. On the downside, support will again be seen at the recent 0.6630 pivot, ahead of 0.6600 and 0.6580. In the medium term, look for the chance of a decline towards 0.6560 (January flash crash low) and eventually to the long term rising trend support at 0.6500 – from March 2009.

On the crosses, a neutral stance is mostly required, as per the look of the trend-table, where little stands out, although EurChf and EurGbp both look mildly bid in the short term although I prefer to stand aside.

Gold and Silver;  Gold is respecting the neckline (1285) of the SHS formation, and while it does so I still prefer the downside as I suspect the US$ strength will return to place downside pressure on commodities. Tight stops should be in place above the 100 DMA, at 1292. Should the SHS formation work as planned, the downside target is seen at 1218 but that is a long way off right now. Silver has tested its own neckline last Tuesday and then bounced to 15.07 but is now back at 14.91. 15.00 200 DMA) and 15.05 should continue to act as resistance (50% pivot of 13.89/16.21), but above which could then see a run toward the 100 DMA at 15.32. On the downside, we still need to see a break of 14.80, in which case the the downside potential is at around 13.85oz, albeit that this may be wishful thinking. Right now though, I prefer to remain short, looking for a decisive break of 14.80.

Stocks: had a rather flat session albeit that the US indices are pretty much at all-time highs. Further gains may be expected if the Fed continue their recent dovish tone on Wednesday, and then we are into blue sky territory. As before, the dailies are showing a degree of bearish divergence but the weeklies remain positive and the near term targets are, in the S+P at 2950 and in the DJI at 26950. We need to hold above rising trend support in order to maintain the upside momentum, but right now that seems to not too much of an issue and trading from the long side is the plan given the strong upside momentum in the weekly charts. I think SL should be placed below 2900/26000.

WTI: recovered some of Friday’s losses on Monday, to finish at 63.60 and remain rather precariously placed just above on the 4 month rising trend support, albeit that the medium term uptrend currently remains intact. The dailies though are pointing lower, and a downside break would  open the way to 62.20 and then to 61.70 (both minor) ahead of the 200 DMA/Fibo support @ 23.6% of 42.23/66.57, currently at 60.85. Under there allows for 58.00 and 57.30 (38.2%). On the topside, resistance will be seen at 63.85, 64.35 (both minor) and then at 64.70 (200 HMA) and 65.00 – although this now looks a good sell opportunity. Further out, last week’s trend high was at 66.57, albeit that this is now some way off.

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*Trade of the day: April 30, 2019; 8:13 AM(AET)                               

*This is a personal opinion only, based on the look of the table below, and carries no guarantee of success.

All trades are good till 5.00pm NY time. All “in the money trades” should have the SL raised to break-even, or managed manually. All “out of the money trades” should keep original SL in place.

Sell EurUsd @1.1235. SL @ 1.1275, TP @ 1.1145

Buy EurUsd @ 1.1140. SL @ 1.1095, TP @ 1.1215

Sell AudUsd @ 0.7110. SL @ 0.7135, TP @ 0.6990

Sell WTI @ 64.50. SL @ 65.20, TP @ 63.00

Sell Silver @ 15.00. SL @ 15.20, TP @ 14.50

Sell Gold @ 1285. SL @ 1302, TP @ 1260