DXY at 100.82 traded deeply oversold and dangerously close to the 99.00 break while EUR/USD at 1.1032 became massively overbought and near the 1.1100 break. EURUSD was heading lower and DXY higher. The only question was how fast or how slow it would prices travel.
NFP was a terrific bonus as EUR/USD was relieved of overbought conditions to now trade oversold while DXY oversold offers severely overbought at 102.00’s.
DXY vital breaks are located at 103.29, 103.55, and 103.67, then begins averages at every 100 pips to 114.00 highs. Below, DXY must break 101.90 and 101.75. Longer term, DXY must break 99.00, 98.00, and 97.00’s. Break at 97.00’s, then DXY travels miles lower to 93.00’s.
The DXY. USD and USD/JPY trade strategy remains short only as DXY downside contains 400 pips to challenge the 99.00 support. D XY’s overall range is located from 99.00’s to 103.00’s.
Supports hold oversold EURUSD at 1.0629 and 1.0705. Vital 1.0912 must break for EUR/USD to trade from 1.0912 to 1.1135. Higher targets are located at 1.0805, 1.0925, and 1.1048 as the final target. EUR/USD contains the easy ability for the 1.1048 target to achieve its destination this week. EUR/USD long entry is found around 1.0755.
USD/JPY broke 129.65 and traded to 131.00’s. Shorts must again break 129.65 to target 128.00’s. USD/JPY overall trades 839 pips from 124.92 to 133.31. Lower this week for USD/JPY will trade 132.00’s to 124.92 to further compress the range. The final target at 121.00’s holds on a short only trade strategy.
GBP/USD must break 1.2114 and 1.2144, then the target becomes 1.2418 on a long only strategy. GBP/USD is required to break 1.2584 to target 1.2700 as the final destination.
AUD/USD targets 0.6940, 0.6973, and 0.7105 while NZD/USD targets 0.6428, 0.6512 and eventual 0.6601. NZD/USD big line break above is located at 0.6492.
Gold
As EUR/USD travels higher, Gold targets 1975.88 and 1982.22 on a long only strategy. Shorts begin at 1975.00’s. As DXY approaches 99.00’s and 400 pips of a downside, Gold can trade 2034.49. Driving Gold higher is average supports below at every 100 pips from 1800.00’s.
SPX
Weekly target is located at 4222.69. S&P 500 supports are located at 4100.00’s, 3900.00’s, and 3700.00’s. Expect SPX to travel higher on a slow grind as current averages fail to support much higher to 4300’s over the next month. SPX 5000 is a current dream rather than a reality.
WTI
Crude Oil WTI Futures ranges from 77.00’s to 83.00 and 85.00’s. For the week, the target is located at 81.32. Above 85.00’s, WTI travels much higher.
EUR/AUD Vs GBP/AUD
GBP/AUD’s big break for higher is located at 1.7564 and targets 1.7700’s easily. GBP/AUD trades deeply oversold on a long only strategy. The problem to GBP/AUD is overbought EUR/AUD. EUR/AUD’s top is located 1.5700’s and 1.5800’s and can’t handle much higher in the short term. The GBP/AUD and EUR/AUD relationship has been off kilter for the past 2 months and doesn’t appear to stabilize anytime soon.
USD/CAD sits at do or die at 1.3382 and massive support at 1.3131. USD/CAD’s next target below is found at 1.3232. However USD/CAD will struggle to trade lower at 1.3309. The final target at 1.3113 holds.
GBP/JPY trades 156.28 to 161.34. JPY cross remain on a short only strategy to trade lower alongside USD/JPY. The big 3 JPY cross pairs remain GBP/JPY, EUR/JPY and CAD/JPY.
Overall best trades for 2023 remains EUR/USD, GBP/USD, USD/JPY, and JPY cross pairs GBP/JPY, EUR/JPY. GBP/CAD is the better trade to EUR/CAD, EUR/NZD over GBP/NZD and EUR/AUD over GBP/AUD.