Forex Archives - Page 49 of 59 - the patient investor

May 9, 2012

Forex: Australia, Canada and South Africa

Weakening commodity prices are dragging the Australian Dollar lower against the greenback. Breach of support at $1.02 indicates another test of primary support at $0.96. Reversal of 63-day Twiggs Momentum below zero already warns of a primary down-trend. Failure of primary support at $0.96 would confirm, offering a long-term target of $0.84*.

Australian Dollar/US Dollar

* Target calculation: 0.96 – ( 1.08 – 0.96 ) = 0.84

Canada’s Loonie is strengthening against the Australian Dollar, having penetrated its long-term descending trendline and with 63-day Twiggs Momentum recovering above zero. Breakout above parity would signal the start of a primary up-trend.
Canadian Dollar/Australian Dollar

The Loonie retreated against the greenback, testing support at $0.995 after a false break above $1.01. Failure of support would confirm a bull trap and test primary support at $0.95. Recovery above $1.01 remains as likely, however, and would signal a primary advance; respect of zero by 63-day Twiggs Momentum would strengthen the signal.

Canadian Dollar/US Dollar

* Target calculation: 1.01 + ( 1.01 – 0.96 ) = 1.06

The Aussie found support at R7.90 against the South African Rand. 63-Day Twiggs Momentum remains weak and reversal below zero would indicate a primary down-trend. Failure of support at R7.90 would warn of a correction to R7.50*. Recovery above R8.30, however, would signal a fresh primary advance.

Australian Dollar/South African Rand

* Target calculation: 8.00 – ( 8.50 – 8.00 ) = 7.50

Colin Twiggs

Colin Twiggs is a former investment banker with almost 40 years of experience in financial markets. He co-founded Incredible Charts and writes the popular Trading Diary and Patient Investor newsletters.

Using a top-down approach, Colin identifies key macro trends in the global economy before evaluating selected opportunities using a combination of fundamental and technical analysis.

Focusing on interest rates and financial market liquidity as primary drivers of the economic cycle, he warned of the 2008/2009 and 2020 bear markets well ahead of actual events.
He founded PVT Capital (AFSL No. 546090) in May 2023, which offers investment strategy and advice to wholesale clients.

May 9, 2012

Forex: US Dollar/Japanese Yen

The US dollar is testing long-term support at ¥80. Failure would warn of weakness in the primary up-trend but 63-Day Twiggs Momentum holding above zero suggests continuation. Recovery above ¥82 would indicate a fresh primary advance, with a target of ¥90*.

US Dollar/ Japanese Yen

* Target calculation: 85 + ( 85 – 80 ) = 90

Colin Twiggs

Using a top-down approach, Colin identifies key macro trends in the global economy before evaluating selected opportunities using a combination of fundamental and technical analysis.

May 9, 2012

Forex: Euro and Pound Sterling

The euro broke support at $1.30, completing a bearish descending triangle on the weekly chart and signaling another test of primary support at $1.26. In the longer term, breach of $1.26 would offer a target of $1.17*. Respect of the zero line (from below) by 63-day Twiggs Momentum strengthens the bear signal.

Euro

* Target calculation: 1.26 – ( 1.35 – 1.26 ) = 1.17

Pound Sterling is in a strong primary up-trend against the euro, with 63-day Twiggs Momentum completing troughs high above zero. Target of €1.255* for the current advance is about to be broken.

Pound Sterling

* Target calculation: 1.215 + ( 1.215 – 1.175 ) = 1.255

Colin Twiggs

Using a top-down approach, Colin identifies key macro trends in the global economy before evaluating selected opportunities using a combination of fundamental and technical analysis.

May 9, 2012

Gold breaks support at $1600/ounce

Spot Gold broke its long-term rising trendline and support at $1600, warning of a primary down-trend. Reversal of 63-day Twiggs Momentum below zero strengthens the signal. Failure of primary support at $1500 would confirm, offering a target of $1200*. Recovery above $1600 would indicate all bets are off.

Spot Gold

* Target calculation: 1500 – (1800 – 1500) = 1200

The Gold Bugs Index, representing un-hedged gold stocks, has been suggesting a gold down-trend for some time.

Gold Bugs Index

The Dollar Index broke through resistance at 80 on the weekly chart and a 63-day Twiggs Momentum trough above zero indicates another rally. Expect a test of 82 in the next few weeks, mirrored by a weakening gold price.

US Dollar Index Weekly Chart

* Target calculation: 82 + ( 82 – 78 ) = 86

Colin Twiggs

Using a top-down approach, Colin identifies key macro trends in the global economy before evaluating selected opportunities using a combination of fundamental and technical analysis.

May 3, 2012

Forex: US Dollar/Yen

The US dollar is testing long-term support at ¥80. Failure would warn of weakness in the primary up-trend, while respect would indicate a primary advance to ¥90. 63-Day Twiggs Momentum holding above zero suggests continuation of the primary trend.

US Dollar/ Japanese Yen

* Target calculation: 85 + ( 85 – 80 ) = 90

Colin Twiggs

Using a top-down approach, Colin identifies key macro trends in the global economy before evaluating selected opportunities using a combination of fundamental and technical analysis.

May 3, 2012

Forex: Pound Sterling strengthens against Euro

The euro is headed for another test of support at $1.30. Failure would complete a small bearish descending triangle on the weekly chart. Breach of primary support at $1,26 would offer a long-term target of $1.17*. Respect of the zero line (from below) by 63-day Twiggs Momentum would strengthen the signal.

Euro

* Target calculation: 1.26 – ( 1.35 – 1.26 ) = 1.17

Pound Sterling is in a primary up-trend against the euro, as indicated by 63-day Twiggs Momentum above zero. Target for the current advance is €1.255*.

Pound Sterling

* Target calculation: 1.215 + ( 1.215 – 1.175 ) = 1.255

Colin Twiggs

Using a top-down approach, Colin identifies key macro trends in the global economy before evaluating selected opportunities using a combination of fundamental and technical analysis.

May 3, 2012

Forex: Australia, Canada and South Africa

The Australian dollar has tracked the CRB Commodities Index fairly closely since 2009. Weakening commodity prices warn that the Aussie is likely to follow.

CRB Commodities Index and Australian Dollar

Against the US dollar, the Aussie is headed for another test of support at $1.02. Reversal of 63-day Twiggs Momentum below zero warns of a primary down-trend. Failure of support at $1.02 would confirm this, offering an initial target of $0.99.

Australian Dollar

* Target calculation: 1.02 – ( 1.05 – 1.02 ) = 0.99

Canada’s Loonie is in a primary up-trend against the Aussie dollar — as signaled by the 63-day Twiggs Momentum cross to above zero. Breakout above $0.982 completes a bullish ascending triangle formation with a target of parity.

Canadian Dollar

* Target calculation: 0.98 + ( 0.98 – 0.96 ) = 1.00

The Aussie is also weakening against the South African Rand. Cross of 63-day Twiggs Momentum below zero warns of a primary down-trend. Failure of support at R7.90 would confirm, offering an initial target of R7.50*.

South African Rand

* Target calculation: 8.00 – ( 8.50 – 8.00 ) = 7.50

Colin Twiggs

Using a top-down approach, Colin identifies key macro trends in the global economy before evaluating selected opportunities using a combination of fundamental and technical analysis.

May 3, 2012

Gold and Dollar indicate uncertainty

Spot Gold continues its consolidation between $1600 and $1700 per ounce, while testing the long-term rising trendline. Recovery above $1700 would suggest another primary advance; confirmed if an inverted head and shoulders formation is completed by a rise above $1800. 63-Day Twiggs Momentum oscillating around zero indicates uncertainty, however, and failure of support at $1600 would warn of a long-term trend change and test the primary level at $1500.

Spot Gold

* Target calculation: 1800 + (1800 – 1600) = 2000; 1500 – (1800 – 1500) = 1200

The US Dollar Index reflects the inverse of gold, with a potential triple bottom threatening to end the long-term down-trend on the Monthly chart. 50-Week Twiggs Momentum is oscillating around the zero line, indicating uncertainty.

US Dollar Index Monthly Chart

On the weekly chart, the dollar has met strong resistance at 80 and reversal below support at 78 would warn of another test of the 2011 low at 73. Reversal of 63-day Twiggs Momentum below zero would strengthen the bear signal.

US Dollar Index Weekly Chart

* Target calculation: 82 + ( 82 – 78 ) = 86; 78 – ( 82 – 78 ) = 74

Colin Twiggs

Using a top-down approach, Colin identifies key macro trends in the global economy before evaluating selected opportunities using a combination of fundamental and technical analysis.

April 26, 2012

Forex: Japanese Yen

The greenback is consolidating between ¥80 and ¥82 against the Japanese Yen. Recovery above ¥82 would indicate a fresh primary advance, with a target of ¥90*. Respect of zero by 63-day Twiggs Momentum would confirm a strong primary up-trend.

USD/Japanese Yen

* Target calculation: 85 + ( 85 – 80 ) = 90

Colin Twiggs

Using a top-down approach, Colin identifies key macro trends in the global economy before evaluating selected opportunities using a combination of fundamental and technical analysis.

April 26, 2012

Forex: Euro and Pound Sterling

The euro continues to test medium-term support at $1.30. With the dollar currently “the best horse in the glue factory”, support is likely to fail, signaling a re-test of the primary level at $1.26. A 63-day Twiggs Momentum peak below zero would indicate continuation of the primary down-trend; failure of primary support would confirm.

Euro

* Target calculation: 1.26 – ( 1.35 – 1.26 ) = 1.17

Sterling is testing resistance at $1.62. Recovery of 63-day Twiggs Momentum above zero indicates a primary advance, but news that the UK has dipped back into recession may inhibit further gains. Reversal below the rising trendline would warn of another test of primary support at $1.53, while breakout above $1.62 would signal an advance to the 2011 high of $1.67.

Pound Sterling

Colin Twiggs

Using a top-down approach, Colin identifies key macro trends in the global economy before evaluating selected opportunities using a combination of fundamental and technical analysis.