Cycle Trading: Weekend Report preview

LikesMoney Independent Analyst

The Dollar

The dollar printed a bearish reversal on day 8 then delivered bearish follow through on Monday by closing below the converging 50 day MA and 10 day MA.

Closing below the converging 10 day MA and the 50 day MA on Monday confirmed the daily cycle decline. The dollar continue lower to close below the 200 day MA on Thursday. With a peak on day 8, closing below the 200 day MA looked like the dollar would be rolling over into an intermediate cycle decline. But then the ECB intervened — causing the dollar to close convincingly above the 200 day MA on Friday. While 13 days is too early to expect a DCL, the manipulation in the currency markets could force an early DCL. A break above 97.82 will form a swing low to signal the new daily cycle.

The dollar did close below the lower daily cycle band. That does end the daily uptrend and begin a daily downtrend. It also signals that the intermediate cycle decline has begun.

Stocks

Stocks formed a swing high on Friday and then delivered bearish follow through on Monday to close below the 10 day MA to signal the daily cycle decline.

Stocks printed their lowest point on Tuesday, following the day 39 peak. That was day 42, placing stocks deep in their timing band for a daily cycle low. A swing low formed on Wednesday. Then stocks closed back above the 10 day MA to confirm day 42 as the DCL. Stocks are currently in a daily uptrend. Stocks will remain in their daily uptrend unless they close below the lower daily cycle band.

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LikesMoney

Independent Analyst

Assets (such as stocks, gold, and the dollar) have identifiable cycles.

EUR/USD hits two-day highs near 1.1820

EUR/USD picks up pace and reaches two-day tops around 1.1820 at the end of the week. The pair’s move higher comes on the back of renewed weakness in the US Dollar amid growing talk that the Fed could deliver an interest rate cut as early as March. On the docket, the flash US Consumer Sentiment improves to 57.3 in February.

GBP/USD reclaims 1.3600 and above

GBP/USD reverses two straight days of losses, surpassing the key 1.3600 yardstick on Friday. Cable’s rebound comes as the Greenback slips away from two-week highs in response to some profit-taking mood and speculation of Fed rate cuts. In addition, hawkish comments from the BoE’s Pill are also collaborating with the quid’s improvement.

Gold climbs further, focus is back to 45,000

Gold regains upside traction and surpasses the $4,900 mark per troy ounce at the end of the week, shifting its attention to the critical $5,000 region. The move reflects a shift in risk sentiment, driving flows back towards traditional safe haven assets and supporting the yellow metal.

Crypto Today: Bitcoin, Ethereum, XRP rebound amid risk-off, $2.6 billion liquidation wave

Bitcoin edges up above $65,000 at the time of writing on Friday, as dust from the recent macro-triggered sell-off settles. The leading altcoin, Ethereum, hovers above $1,900, but resistance at $2,000 caps the upside. Meanwhile, Ripple has recorded the largest intraday jump among the three assets, up over 10% to $1.35.

Three scenarios for Japanese Yen ahead of snap election

The latest polls point to a dominant win for the ruling bloc at the upcoming Japanese snap election. The larger Sanae Takaichi’s mandate, the more investors fear faster implementation of tax cuts and spending plans.

XRP rally extends as modest ETF inflows support recovery

Ripple is accelerating its recovery, trading above $1.36 at the time of writing on Friday, as investors adjust their positions following a turbulent week in the broader crypto market. The remittance token is up over 21% from its intraday low of $1.12.