The uptrend neckline of this head and shoulders is now toast and the bias is obviously negative.
Net USD positioning has moved into negativity territory for the first time since May 2014, which was roughly when EURUSD topped.
USD looks set to surge.
This 4h candle hasn't closed yet so we can see if the MACD will actually negatively cross, but there is a high probability that this will happen.
Get short on a break of the uptrend line, to the next level which is 1.1233 where you should reassess the risk/reward.
A number of fundamental factors also feeding into the negative picture for US stocks:
- QE3 ends
- $BABA IPO
- USD surge
- China housing bubble popping
- EZ deflation quagmire
- Numerous wars
Disclaimer: Wait for the daily close if your not already short.
- RSI oversold, but as we all know oversold can get more oversold.
- Trend going back to 11/12 (Long term uptrend continues until it doesn't!).
- Confluence of 50% fib and 1900.
- A perfect BTFD scenario is a retest of 1900 between the 11th-14th (next week).
- Finally approaching that uptrend line from 07/12, any break and close below could lead bulls to question their positions.
- There is potential for a range here from 1.3480/1.3500 - 1.3700.
- RSI oversold, MACD Histogram on its way back to 0?
- EZ CPI data tomorrow with any surprise being decisive for the pair.
- After failing to break above the cloud has moved lower.
- Confluence of support between 09/13 high (100.60), 200DMA currently @ 100.24) and uptrend line from 06/13 (Currently rising from 100.20).
- If all this is passed then I would be looking for support @ the 100.00 handle which is psychologically key for Japan.
- Any convergence of the 200DMA and the 100.00 ...
- Since becoming support in May 2012 the 78.70 level has been solid.
- You now have a H&S set up on the weekly with the 50% retrace as the neckline.
- If this confluence of support is broken on the weekly chart it would be very bearish for USD.
- Very possible we could bounce from this level as it will be well defended.
- Closes the week below up trend line from 2012 and the 200WMA.
- MACD giving negative cross
- H&S formation with the neckline @78.60.
- Fundamentally the real question is was the weather really to blame for all of that bad data and will super dove Yellen continue to taper in the face of a softening economy?