VantagePoint AI Market Outlook for the Week of August 12th, 2019
The Vantagepoint AI Market Outlook is designed to help traders. It’s important to remain aware of correlations in the global markets. Traders can become more profitable if they know how to get ahead of the trends. Utilizing the predictive indicators in VantagePoint Software can help traders find the right trades and the right times. Above all, traders know when to enter and exit those trades for maximum profit. Let’s look at the charts for the U.S. Dollar, Gold, Crude Oil, The Stock Market, and Major Pairs.
Hello, everyone and welcome back. My name is Greg Firman and this is the VantagePoint AI Weekly Outlook. Now, in this particular outlook, each week we’re going to be looking at all of the major markets and what to expect and how to trade them using the VantagePoint AI software. We’ll be looking at the dollar index, gold, oil, the S&P 500, even bitcoin, and of course, our major forex pairs. To get started, we’re going to begin with the dollar index. We can see that the dollar is down, but not out. When we look at this, we’ve got verified support coming in at or about the 96-98 level. Our indicators are still negative on the dollar, but we can see that the medium-term crossover is starting to turn.
Now, we’re closing below that key level, 97-40, but just barely at 97-32. When we look at our individual crossovers from VantagePoint, we’ve got our short term, which is very conflicted, almost pointing higher. Our medium-term is still down. When we look at our long predicted by itself, we can see that the power of the AI, how it uses the predicted moving average, the market is unable… Once it breaks below it, it’s unable to penetrate back above it, even though it’s retested this area three or four times in the course of one trading week. If we can break above 97-46, we could see the downside pressure off the dollar.
The Gold Market
Now, when we look at that and compare that to direct inner market correlations, we can see that gold is putting a top in at or about the 15-22 area.
But once again, we can see the power of the AI, the medium-term crossing, the long term predicted difference in the opposite direction in which the market’s been moving. The neural index is in agreement that gold is moving lower. We’re extremely overbought, so all of these combined together suggest that gold is moving lower. Now, the further advantage of the software is that we have downside pivot areas. Because something moves lower, guys, does not mean that it’s a trend reversal. We can see multiple times where we’ve come back down, tested the VantagePoint, T-cross long, only to rally off of that level. Now, that level is all the way down at 14-61, 14-84 in the medium, and 1505 in the short.
Unless we can get below all three of these levels and close below them, gold still remains firm and likely a strong buy given the current market environment. But again, nothing goes straight up and nothing goes straight down, so we should expect a bit of a pullback based around these indicators.
Now, the same thing goes for the S&P 500. we’ve had a massive sell-off off a 30-25 area. But once again, when we look at measuring the medium term against the longer-term trend, combining it with the neural index in the additional indicators, we can see that the S&P 500 is again recovering. However, we’re unable to again break through this 29-42 area. As of late, there has been a very high correlation between the US dollar and the S&P.
When the dollar recovers, the S&P goes with it and vice versa. Unless we can get above 29-42, there’s still pressure on the downside, but the software is warning that we’re going higher. Now, again, that medium-term that took place long before this retracement hire happened, but I’ll further point out, not only did it call the move down, but it’s also calling the move back up. These are definitely things that we want to be watching in our trading for not just with the trend because remember the market is only trending 20% of the time at best. 80% of the time it is going back within an overall range. You can see the range bottom over here that’s coming in at or about the 27-33 area and a very clear top in place at 30-25, excuse me.
The way this also appears, at least it appears to be having a very negative effect on oil too as the equity sell off, but we can further assess that as the markets sell off and then they retrace back higher, oil tends to follow it back up. Now, once again, a very strong counter trend by signal, oil still could be arguably in a very broader downtrend. But when we look at the indicators, again, you’ve got a range bottom down here that’s coming that basically kissed it to the number at 50-50 and now is retraced all the way back up, like a moth to a flame, to the T-cross long at 5508. These are the things that we want to watch. In order for oil to continue to advance, we must clear 55-08.
Forex Weekly Outlook for Major Pairs
Euro/U.S. Dollar (EUR/USD)
Now, when we look at some of our main forex pairs, again, the forex market, the largest market in the world, is currently just under $5 trillion per day is the daily turnover rate in the forex market. Most of the currency pairs only moving 1% of their value per day. The least volatile market out there right now. Now, when we look at the Euro-US pair, we can see that we’ve got resistance building here. We’ve got multiple verified resistance zones going all the way to 14-20, but were stalling out again here on this Euro sitting at or about the 112-49. Now, we also have an inside bar consolidation bar directly beside the swing high, so we do have consolidation. We’re looking for the next move.
In my respectful opinion, that will come from either a break of 112-49 or a break of 111-86 off of this main bar. The indicators from VantagePoint are starting to roll over to the downside. You can see the medium term predicted difference. Measuring that medium term crossover is starting to weaken against the longer term. The neural index is also getting weaker, but the predicted RSI suggesting we have a little bit more upside, but the level we want to watch is again the T-cross long. On a breakdown of 111-78 in additionally the 111-68 area, that would likely lead to a potential retest of the range bottom. Now, if we can take out 112-50, 112-60, stay above that level for at least two days.
We should be able to start looking at a move back towards the 114 area. But again, my optimism on that at this particular time remains heavily guarded.
U.S. Dollar/Swiss Franc (USD/CHF)
Now, with the US-Swiss franc, we can see that as the equity start to turn around a little bit, that actually helps pairs like US-Swiss franc. We can see our medium term crossing our longterm predicted difference, RSI coming out of heavily oversold territory. Again, we’re coming down to a known verified zone here. That low point currently resides at or about the 96-93 area. We’d come down exactly to that number on August 7th only for the market to basically stall. We’re sitting right around this area.
But if we can get the neural index turning green here and we can get the S&P 500 on the move and break above 29-40, then a long on US-Swiss franc will be… Well, actually, quite a good trade.
U.S. Dollar/Japanese Yen (USD/JPY)
The same thing would apply to dollar-yen and this is what forex traders need to understand, the risk on and risk off environment. We’ve got the exact same signal trying to form on dollar-yen. If dollar-yen, again, if the neural index can turn green, that should send this higher. If for nothing else, higher on a corrective basis back to this 107-21 area. Now again, US-Swiss franc is the same thing. To be clear, the trend is clearly down. This retracement higher is likely only that a natural retracement.
When we look at that level on US-Swiss franc, 98-38, these are the levels we want to know, guys, that, you know, if we’re going to go long here counter trend, it’s fine, but be careful around there. The market could move to that number and then fail miserably.
British Pound/U.S. Dollar (GBP/USD)
Now, with the pound-dollar for next week, we’ve had a very, very long heavy support line sitting off of this basically 120-80 level. Now, we’ve breached that a little bit, but this is on Brexit concerns and thin illiquid markets in Friday trade. I’m not sure, you know, if we’re going to move much further from here. We’ll have to see. But if we do, I think either way, the 120, the 119-90, 119-68 area will contain any further bear move here.
Because again, I really do feel that the British pound is grossly undervalued against the US dollar. Now, you can be pro-Brexit or against Brexit, but either way, the UK economy is not in that bad a shape. The British pound has given up close to 50% of its value against the US dollar. We know that things do not go straight up and straight down. If we can get a turnaround here on dollar weakness, we’re going to need gold moving lower. We’re going to need equities moving higher. That should take the downward pressure off the British pound.
The Commodities Currencies
U.S. Dollar/Canadian Dollar (USD/CAD)
Now, as we look at our three main commodity currencies, once again, US-CAD has put a top in place yet again at this 133-40 area. You can see that we’ve got a series of much low or highs here.
When we’re coming down, we’re failing at that T-cross long 131-96. if we can break through that area, then we should see this pair accelerate to the downside. That would mean that equity equities are going higher, the S&P, the Dow, oil prices are moving back up. But again, we’ve got to be a little cautious down around this 131-90 area because often times on Mondays, we get a false break only to see price action reverse on Tuesday. I’ve continually warned people in the VantagePoint live training room about this type of scenario that we’ve seen in live conditions every week for the last 18 months. Be cautious with this pair. Right now the RSI is teetering at 51.7. It’s not breaking into bear territory, but it’s certainly close.
Our medium and longterm predicted differences both pointing down. Again, right now while we’re holding below 133-46, shorts are definitely favored.
Australian Dollar/U.S. Dollar (AUD/USD)
Now with Aussie-US and New Zealand-US, both have been hit hard by that surprise 50 basis point cut from the Bank of New Zealand. I was a little shocked on that one myself, but that’s taken a little bit of luster off of these two currencies, particularly the Kiwi. Now when we look at the Aussie, we’re retracing higher. The Aussie does have a strong correlation to gold, but as of late, it’s had a much stronger correlation to the global equity markets, more specifically the S&P 500. I would keep an eye on this one. Right now we are forecasting this to go higher, but we must clear 68-62, guys.
New Zealand Dollar/U.S. Dollar (NZD/USD)
If we can’t get above that area, then it’s simply a retracement and we would expect another failure, but that would be a leading indicator that the equity markets were going to fail also. The exact same thing applies to New Zealand. You can see that we’ve had a massive sell-off after that surprise rate cut, but we’ve had zero follow through, guys. This is what I mean about these these announcements. They’re just noise. Okay? That’s very, very important that we understand the difference between real trading and trading off of the noise, which is the news, right? I think that New Zealand right now, the Bank of New Zealand, is certainly taking defensive measures, but I don’t anticipate too many more cuts from them.
If anything, we should probably stabilize around 1% and see where we go from there. Once again, this is the VantagePoint AI Weekly Outlook, and I look forward to, again, seeing everybody here next Saturday for the same outlook. Thank you.