We had forcasted that AUDUSD was in a 4th wave triangle with one more terminal thrust to the upside to complete a topping pattern with 1.0385 to 1.0410 as potential highs for that thrust. AUDUSD peaked in Asia Sunday evening at 1.0416 and the selloff commenced. After making new weekly and monthly highs Aussie is now both lower on the week and month,  although there will be stops along the way 9470 is an intermediate term objjective. We have taken out stops under Friday’s low of 1.0318 and may now correct this first break, but The Vultures are licking their chops eyeballing the layers of sellstops under this market. Good hunting

In previous posts(see archives) we have pointed out the many significant inflection points that followed NFP releases and Friday could be one of the most important of the year to date. The DXY is attempting to carve out a bottom above the 75 level. The whipsaw, trendless action is indicative of a market in transition attempting a shift in trend. The pieces of the puzzle are beginning to line up for this contrarian forcast and here is our laundry list. The EURUSD & GBPUSD are both rising wedges which are reversal formations that imply complete retracements from where advances begun (dollar bullish) GBPUSD doesn’t look like 1.64 will be revisited more probable is a Fib failing rally from the recent low of 1.5936 of the fall from 1.6405. So for those two pairs I label GBPUSD as topped and EURUSD as topping. As discussed last week our view is USDJPY has bottomed in that nasty 5th wave terminal thrust out of a wave 4 triangle although overbought here we believe the low is in on an intermediate term basis (dollar bullish). USDCHF has in our view bottomed although in a wave 2 pullback I expect higher lows (dollar bullish) Just like the USDJPY bottomed on a terminal thrust to the downside AUDUSD is now in a 5th wave termnal thust to the upside a topping formation. USDCAD has not made a new low for weeks and is in the process of bottoming as even marginal new lows will post another momentum non-confirmation. Gold has glaring divergences on the daily and weekly timeframes and has already peaked in my view at 1,448.00 I can make a case for 1.250 by the end of the second quarter. I’ll wrap it up with Copper which hasn’t posted new highs for weeks and has a negative pattern. They say Copper has a PHD in economics based on it being a leading indicator and also “All Bull Markets are roofed in copper. All of these market messages are telling me “The risk OFF” trade is imminent. Good hunting

Last weeks forcasted turn in the DXY has been met mainly with skepticism, I have read it’s “A dead cat bounce” “oversold bounce”, few are embracing that last weeks action could have been a significant Reversal Turning point up in the DXY. This is being reinforced buy in my view corrective bounces in EURUSD & GBPUSD. So keep an eye out on ”THE DEAD CAT” CAUSE THIS ONE MAY Have CLAWS. Good hunting

Earlier in the week we blogged about 7550 being a probable target for The DXY going into the Spring Equinox,Full Moon sequence. With the G-7 about to meet it is possible that their actions, language to ease fears and encourage risk taking could be the catalyst to take DXY there and terminate this phase of USD weakness. It is also my view that yesterdays massacre in USDJPY may mark a significant low watermark for that pair after a final dramatic Wave 5 Thrust to the downside out of a Wave 4 Triange. I don’t expect USDCAD to make a new low, but a higher one and AUDUSD has demonstrated unrelenting weakness in a generally weak USD environment. Potential StopHunt in GBPUSD under 1.5970 wll be like a magnet. Good hunting

Yesterday’s commentary pointed out that despite DXY weakness that USDCAD was acting resilient and that was a market tell for risk aversion. we have been in the minority calling for a rally in this pair so the contrarian stance proved to be the right side in this case. It was also mentioned that USDCAD would be a good proxy for an S&P decline  and this is manifesting on our screens today. We mentioned GBPUSD being the preferred short over EURUSD and that has been borne out with GBPUSD having a complete retest of last weeks low while EURUSD is correcting it’s recovery. Good hunting

If you recall the movie where Peter Sellers played Chauncey the gardener who became a famous economist because he proclaimed there would be “Growth in the Spring” it applies here, only with the caveat that what will really grow is risk and risk aversion. W.D. Gann placed a lot of weight on changing of seasons with change of market direction. It’s our contention that the dollar can complete this bear phase going into late this week or early next, best guess for DXY downside is 7550-60 Good hunting

As of yesterday it looked like a Reversal week in the USD was highly probable. As FX traders we learn to expect the unexpected and for me I was surprised. Although expecting some book squaring short covering in EURUSD, GBPUSD and AUDUSD. the explosion in AUDUSD did surprise me, but now puts back on the table a major StopHunt above 1.0255 for the pattern to complete. DXY looks like 7550-60 is likely as well and I welcome both scenarios because I’m ready to execute as these forecasts unfold are you? Good hunting

This blog has been commenting that strength in risk aversion pairs USDJPY&USDCHF may be a harbinger of a USD recovery, Voila it was an important message. There was mention of excessive dollar bearshness and now believe that will begin to abate. USDCAD was discusssed as a decent proxy for an S&P short and even Rip Van Winkle is awaking from it’s slumber with a reversal week to the upside as Equity markets stumble. Stay tuned & Good hunting