VantagePoint AI Market Outlook for the Week of August 31, 2020
U.S. Dollar Index
Hello everyone, and welcome back. My name is Greg Firman. This is the Vantage Point AI Market Outlook for the week of August the 31st, 2021.
Now to get started this week, we’re going to begin where we always do, with that very important U.S. Dollar Index. Now, as we’ve discussed over the last several weeks on the Weekly Outlook, using the VantagePoint T cross long as a pivot area to determine market direction. Now, what we’ve can assess here is that we have repeatedly failed around the VantagePoint T cross long with an extension down on Friday, after a very volatile week with the Federal Reserve.
Now, we do have verified support at, or about the 92 level. What we want to be very cautious of here is one of two things. We’re either going to get a bounce off of this level, or we’re going to start the next leg down on the dollar. Most market participants are very, very short, the U.S. Dollars, so that’s always a concern, but it does look like we’re getting ready for a bigger move.
Now, in my respectful opinion, what I have seen, is that usually the U.S. dollar, there is demand for dollars in the first week of the new month. When we come back, probably after the long weekend, we could see dollar demand at that time, but for now the dollar remains under significant pressure across the board.
Now for this coming week, once again, we look at the 93.18, as long as the dollar index holds below that level, the dollar is still technically bearish. When we click on our F8 using our software, we look at the additional pivot area. 92.84, we’ve closed below both of these levels, so all of the resistance on the U.S. dollar is between 93.17 and 92.84. This means as long as these two levels hold, Euro, U.S. Is likely to go higher, pound dollar is going to go higher, U.S., Japan. Well, that one could go either way, but the gist of it is, there’ll be lack of demand for dollars across the board.
Our predicted differences are turning lower. Our neural index is down, and our MACD also below the zero line, but we still have a crossover. The RSI breaking down below 40 is again, what has been one of the leading indicators that triggered this. Now, what we want to be very cautious about guys, trading off of overbought, oversold accumulation distribution type of signals, because again, these signals can be problematic, but just because something is oversold doesn’t mean it can’t go lower, statistically speaking. If algorithmic programs are triggered, they will continue to short dollars below that 92 level.
Now, my concern, again, is that gold is struggling here. Gold is a leading indicator as for the directional bias of the dollar index. Gold struggling around this verified resistance at 19.70. Now you can see we’ve gone above it, but we’re struggling close above it. We’ve closed slightly above there in thin e-liquid markets on Friday. But the position of the RSI braking holding above 50 for one. Number two, breaking 60 tells us we have momentum building, so gold is likely to move higher, but we really do need to get back up above that 2000 mark, sooner rather than later, or golds could suffer a deeper pullback. I don’t think so based around what the Fed has said, but we still need to be cautious. Our indicators here do support longs for now.
S&P 500 Index
The S&P 500, guys, once again, I’ve talked about this one also over the last several months, and it’s just seems to be a sucker’s bet to sell this thing. While shorts appear to be so easy, once again, you can see when we have a verified … every time we have put in a verified resistance zone, and the market makes that verified resistance zone, when it breaks that level, it’s a very, very easy buy. What I anticipate is that things will slow down a little bit on the S&P, we’ll stall up here, and then we’re going to have a retracement. The key thing is know your levels. 33.93, as long as we’re above 33.93, it’s still bullish. When we click on our F8 here, we can see that our intraday pivot area is coming in at 34.58, the further we move away from this level, the more likely it is we’re going to retrace to it. For now, I would anticipate at some point, our corrective move lower, and it could very well be the week after Labor Day.
Oil, again is following, very clearly following the equity markets, but still struggling as we’re moving sideways in this chop, and this is one of the indicators that I will use, the inner market correlations that I will use, to tell me whether the stocks are going to continue to move up. Now, the Fed basically, I think you guys probably have noticed. What I’ve noticed is that most of the gains that came on the S&P 500 came out before the Fed even opened his mouth, the day before. That’s when the equities made a big move up. That information in my respectful opinion was probably leaked, and somebody made a lot of money off that, but now we’re kind of against, oil is kind of stalling. Equities are still advancing, but again, they’re a little tired up here. Oil, basically just flat-lining very little momentum, but with a slightly biased higher, as long as stocks continue to advance.
Now, one of the other markets that I’ve been a strong advocate for, not originally years ago, but I certainly over the last two years, I think we should all be looking at Bitcoin as a potential investment, if and when the dollar makes the next leg down, Bitcoin is likely to accelerate back towards that 13,000 mark. Our key level there for next week, 11,309. This is, you can see, we’ve got all the support building up there. We have an additional verified support zone sitting at that low, at 11,000.126. As long as this is holding, then Bitcoin is just consolidating, waiting for its next move. If we look at the indicators from VantagePoint, our site is starting to rise. We’ve got our neural index has turned green, and we’ve got our medium-term crossing our longterm predicted difference. All of which points to further gains ahead in Bitcoin.
But again, we’ve got to see if the dollar is going to make a corrective move higher, and as long as the dollar index holds below 93.18, Bitcoin longs are absolutely viable even at this lofty level.
Euro versus U.S. Dollar
Now, as we move into some of our Forex pairs, which we review each week, once again in last week’s Weekly Outlook. And again, guys, I always remind everybody, this is an outlook, not a recap of something that’s already happened. We’re looking for key levels for next week’s trading. I discussed this in last week’s Weekly Outlook, that the Euro is still a buy, why we’re holding about the VantagePoint T cross long one 18.03. We cross-reference this to the Dollar Index Level, now at 93.18, as long as the Dollar Index is below 93.18, and the Euro T cross long, we’re holding above one 18.03, the Euro is still very much bullish.
Now the Euro has made some gains. All eyes have been on the pound dollar, which I’ll discuss in a moment here, but for now this coming week, the indicators from VantagePoint remain bullish. And yet another new bullish signal is starting to form, as the predicted differences rise above the zero line. Our neural index is green, and our RSI is breaking above 60, suggesting we have momentum. However, to be clear, we must get through, and get above the psychological 120 level. The first hurdle is going to be the one 19.65 area. Be a little bit cautious. If we start failing around this level, the dollar index starts gaining traction. But remember the number one correlation you want to watch with Euro U.S. of course, is gold. If gold cannot advance, the Euro will not advance either.
British Pound versus U.S. Dollar
When we look at the pound dollar going into next week, the pound, these are some of the main Forex pairs. When we look at the pound dollar for next week, I have discussed this at great length with my own direct clients that we have the yearly opening price, which comes in at 130, about 130.247. We broken this resistance level rate here, and what we’re looking for now is for the 132.47 to act as support for us. Our key T cross long 131.05 were long while above this particular level. When we click on our F8 in the software, you can see how the market used the VantagePoint blue line by itself, the predicted moving average with the correlation to 31 other markets use that as a springboard to accelerate higher. It’s this type of trampoline effect, or spring effect that we look for on a daily basis using the VantagePoint predicted moving averages. Because again, the blue line crossing the black line is very useful, don’t get me wrong. But the key blue line, and using that as a daily pivot area, that’s a winner guys.
When we look at the predicted differences rising above the zero line again, our neural index solid green predicted MACD crossing, so I don’t think that this is a false break at this particular time, but I will point out that the U.K. still has some fundamental issues to deal with. The COVID virus, Brexit signing a deal with The European Union, so the pound is not necessarily out of the woods. I would advise strongly to watch this level at 132.47, and see if we can hold, and stay above that particular level.
Now, with the pound dollar again, we know the key levels there. Just like the pound dollar, the dollar yen, we use the same methodology here, guys, using those key pivot areas.
U.S. Dollar versus Japanese Yen
With the dollar yen for next week, 106.06, that T cross long, our neural index is still down. Our predicted differences are still down. Our RSI is breaking below the 40 level, which suggests we have momentum building to the downside. But once again, guys, gold is a major player here with commodities, currencies, everything. The yen is highly correlated to gold contracts, so if gold does advance, then the dollar yen is going to advance to the downside on yen strength, so understand your inner market correlations and combine those with your main pivot areas.
106.06 is our main level for a trend reversal point. When we click on our F8, very, very important level here on an intraday basis, which is one 105.97. If we’re looking to short this thing here, guys, we want to let the market retrace back up to that level so we can get a premium entry point. The other additional strategy you would have to play here is a breakdown below 105.10. If we break down below this verified support zone, we will advance based around that, so keep an eye on that key level. But I would prefer shorts closer to that one 105.90 Area. In my respectful opinion, that’s a better entry. Let the market shake itself out and see where the dollar goes.
U.S. Dollar versus Canadian Dollar
With the U.S. Canadian pair, once again, we are coming into some pretty heavy support. The Canadian Dollar recovering here, to some extent with the economy, recovering the Bank of Canada. Not quite as dovish as the FOMC, but you can see if we use our verified support zones, we can see that 130.36, is a very, very big level. This is a full retracement. If you’re a Fibonacci trader, you already know this level, or if you’re a grid trader, you can see that this level, this 130.36 is very significant, so if the Canadian Dollar is going to reverse, that’s where it’s going to be, so be careful around that particular level.
Now we’re closing the week at 130.97. I do anticipate another test of 130.36 on Monday or Tuesday of this coming week, but always remember guys, we’re also going to be in somewhat of a holiday short week. We’ve got the non-farm payroll, but right now the three main currencies that are going to benefit from a rise in equities, the Canadian Dollar, the Aussie Dollar and the New Zealand Dollar, so right now the main level T cross long 132.37. Again, if we click on our F8, we get our intraday pivot area. If we’re looking to short between 131.35 and 132.20, those are your key levels. Neural index, still down, predicted MACD still down. And again, be very, very cautious. Just because this is the RSI’s 8.7 doesn’t mean because it’s oversold that it has to go higher. It will likely go lower first.
Australian Dollar versus U.S. Dollar
Now the Aussie and the New Zealand for this coming week remain bullish. As long as stocks remain bullish, the Aussie is feeding off of that, as is the New Zealand. A very nice move this past week here, again, using the key levels that I discuss each week going forward is, again, this is an outlook, not a recap of something that’s already happened. Sometimes market participants or viewers get confused that we’re talking about something that’s already happened. This is for next week’s trading. Again, this video is being done on Sunday afternoon prior to the market open, and we’re discussing levels to buy and sell from using these key VantagePoint levels.
The main reversal point 71.98, we would have to break down below that for the Aussie to reverse. When we click on our F8, once again, you can see how it just like the pound dollar, the Aussie is using this as a springboard to go higher, and it keeps coming back and kissing that, so 72.54 is the area to watch for longs to begin the week. But again, make sure you’re keeping an eye on the S&P 500, if you’re trading the Aussie, U.S. short or long.
New Zealand Dollar versus U.S. Dollar
The same thing would apply for New Zealand here, guys, it’s virtually the same trade, but in my respectful opinion only, the New Zealand may have better value because it’s just clearing its yearly opening price. We’re advancing higher. Yes, of course, we’re overbought at 89.4. Does that mean that the New Zealand can’t go higher because it’s reached accumulation distribution, or it’s overbought? Of course not.
This market could extend considerably higher. The Aussie, the New Zealand, even if we look at this New Zealand currency and we look at it over a five year period, this has been in a fairly significant downtrend. We’ve had a big push down with the COVID stuff, but now we’re recovering. Again, the New Zealand currency has been well up above the 80 cent mark, so when something is over bought, that certainly doesn’t mean it can’t go higher here, guys. We want to make sure we’re watching these levels, but for now, if we’re looking at a corrective move lower to buy from, we would target 66.01, using our T cross long, and if we click on the RF8 in our software, we can clearly see that New Zealand is using that long predicted at 66.33 is a springboard to go higher.
This is where we would focus our entry points on, because again, like a moth to a flame, the market always comes back to this blue line. We’ve had a big extension higher on Friday. The probability is that we may go a little bit higher on Monday, but on Tuesday I would anticipate a retracement, which we can use for longs.
With that said, this is the VantagePoint AI Market Outlook for the week of August the 31st, 2020.