12/28/2021
Markets today have seen an increase in risk on sentiment. Over the last 21 days risk on currencies have seen a sharp decline that was reprieved today. Could this be a breather before another leg higher or a further fall.
Multi day outlook: 630 days can roughly give be estimated at 2 years during this time frame we can take a peak at the markets and how they have preformed. Notably we have 4 currencies on the move and 4 stuck in a range with AUD-NZD and USD-JPY being opposites of each other.
USD has passed above its white 630 day moving avg. this affects our long term view on the USD neutral to bullish as this uptrend is very weak. On its 210 day chart we can see the USD has been in a strong uptrend much stronger than its counter parts while the 50day has been very weak.
JPY has seen a dislocation in correlation with the USD at the 630 day mark that has carried onto the 210 day and the 50 day. This may be reversed in the future. I we have some major spook in the markets. 210 day chart more recently around the past 21 days has seen the JPY fall sharply which could signal an oversold position and imminent reversal as many jpy cross-pairs are seeing a -30% drop today. Though this isn't reflected within the 50 day chart other than a small blip higher we will be watching for this development over the next 5 days as that is the smallest increment of time that is reliable in this series.
AUD on the 630 day time series has seen its peak around 5 quarters ago during Q4 of 2020 coming out of the dark uncertain depths of the pandemic and since then, has seen a massive drop under seller controlled conditions this is reflected within the 230 day chart with the last 21 days seeing buyers gaining strength that is further visible within the 50 day trend though the 5 day trend has been neutrals to higher which seems as an exhaustion move to be followed by sellers regaining control over the next few weeks.
NZD has been correlated to the AUD for a few quarters and now we are seeing it dislocate in a move that can either mean the AUD is to fall or the NZD is to rise based upon market sentiment. Within its 210 day movement we can see that the sellers have been able to tame the spikes within the NZD and currently it looks like we could be due for one soon, though the 50 day chart shows us the extreme weakness and seller controlled markets.
Taking all ques from the 630 day chart we are looking to forecast future market trends as they happen. So I am bullish on currencies like the USD and JPY and bearish on the AUD and NZD.
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