The Week Ahead: 2023-01-23

Lunar New Year, more earnings

Bonds

ZB retested the high from December last week and fell back to leave a doji candle which is indicating indecision by the market. It can be a precursor to a reversal but isn’t that strong of a signal by itself. I’ve added a Fibonacci extension in time from the August high to October low and the first point of interest, a 0.618, did correspond to a minor high. Last week was the next point of interest in the series to be followed by another in the second week of March. The Lomb Periodogram is forecasting a cycle high in this general area with the RSI starting to move down away from very overbought. I’d like a reversal but need some evidence first like dropping back under 129^14.

A better wave (iv) candidate

Crude Oil

Crude didn’t move much last week but did start to poke past resistance at 80.65 which makes it likely to try to continue to advance to test the declining trend line and 84.30.

Late in wave iv

Dollar Index

I’ve fined tuned the next support zone in DX to be between 101.30 and 100.60. The question most want to know the answer to is if the DX high is in. I’m still inclined to be stubborn on that front and say no, but I acknowledge that back in September of last year when I was thinking a retrace was due, this is more than I had in mind. Regardless of if this is a [iv] or a [i], at least a bounce up looks due. First resistance to beat for confirmation of a bounce or more is recovering 103.15.

A bounce up looks due

Euro

Here we have the inverse of the chart above for the most part. Euro will have an ideal exhaustion signal from the Wave 59 9-5 study on this candle. Bears need Euro back under 1.0796 to get anything started.

Due for at least a retrace down

Gold

Gold is pausing against 1932.70 but bears need gold to move lower on this cycle inflection and take out 1889.00 to get a reversal started.

Nearing an inflection point

S&P 500

SPX is being difficult which isn’t a shock considering that we have the FOMC meeting two weeks ahead and in earnings season. I hate earnings as it is easy to get whiplash like we did last week. Still, not a sure thing to rise much past here. Probably prudent to not trade heavily in this area and wait for the market to clear up.

Waiting for the FOMC

Bitcoin Futures

Is the crypto winter over? Too early to say that in my opinion. Over 27060 and I would have to relent and give BTC bulls the benefit of the doubt.

Bulls don’t have an all clear just yet