Jan 11am, FX/S&P/BTC Commentary
Euro-1.1525. Ignore the spike towards 1.1600 on the pint and figure chart---that's a bad data point from NYE that hasn't been corrected. The two dashed, red horizontal lines are at 1.1500 and 1.1480. I think the Euro will fail above 1.1500 and head back down next week. However, the alternate and bullish scenario is the market trades sideways between 1.1480+ and 1.1560ish for 2-3 more days and then it breaks higher. For today, the day's range is 53% of the 10-day average daily so there is room to move and it's Friday so could see trend day right into the close of NYK. Yesterday's mid was 1.1527 and today's is 1.1518. Wait to see how the 950 to 1050am period trades versus the 920 to 950am period to set the tone. Lots of resistance between 1.1585 and 1.1625--I favor looking for selling opportunities in that zone. $Yen is looking very bullish as long as above 107.50-. Since the spike down Jan 3rd, $Yen has been grinding sideways to higher and weakness to mid 107's have been bought meaning there is a lot of overlapping trading from below 107.50 up towards 109. Below 107 would suggest fast fall to the lows. On the upside, there is space between 109.10 and 110. EurJpy still flirting with the key 125 level. This is like the person trapped under ice trying to smash their way through. I suspect a break of 109.10 and 125 would be followed by fast move higher as all the shorts are taken out--most everything I read is saying selling all risk, well Yen pairs at least, at these levels--and to be fair, this is the place to do it. Lot upside(lower prices) with tight stops but price action to me suggests an eventual break higher.
S&P-2585. Just like EurJpy, stocks are banging on that sheet of ice at 2600. Really need a print of 2640/50 to reconnect to the previous congestion zone though. Support comes in at 2540. The most bullish scenario is 2540 hold and 2600 and then 2640 deals. We'll see a fast move to 2750 as all the shorts or stopped out and systematic strategies all flip from short to long. Fast markets are hard to identify in real time but if you do(meaning how far it will go), they can be painless. Below 2540 wouldn't be bearish, it would just suggest a slide to 2500 or so but that level has to hold.
BTC-3630. The left left hand chart on the right side is the 50x150 point and figure. Can see yesterdays sell off stopped right at 3600. The blue horizontal line just below is 3550. This level is the low volume trading zone separating price action above and below it. Buy here down to 3550. Since this is a 50x150 chart, a print of 3500 is needed to reconnect to the price action near the lows. This would be bearish and suggest a fast drop to new lows. When BTC was around 4k, commentaries were 50/50 on bigger picture direction but now they're all getting negative again because it sold off in a 10 minute window yesterday. We've seen this movie before--BTC sits in a tight range only to move big, up or down, in a very short time period. In FX, this is usually triggered by a big order in an illiquid time period so I don't see any reason why it would be different in BTC.