VantagePoint AI Market Outlook for the Week of October 21, 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, Crypto, and Major Pairs.
Hello everyone. Welcome back. My name is Greg Firman and this is the VantagePoint AI Market Outlook for the week of October the 21st, 2019.
The U.S. Dollar
Now to get started this week, we’re going to begin where we always do with that very important U S dollar index. Now what we’re looking at for the dollar this week is, again, I’ve talked about this in previous presentations about these monthly seasonalities. Where the dollar is usually stronger towards the end of the month, and it’s weak in the early part of the middle of the month type thing, but when we look at this right now, we’re coming into a very, very strong verified support area. This low coming in at 96.69 all eyes will be on this particular level. We’re already in a grossly oversold condition at 6.9 on the predicted RSI.
Now again, if we combine this with that monthly seasonality, we should be expecting U S dollar strength coming. Now, what we should also expect to here guys is a very, very volatile open on Sunday night. Again, I’ve held the weekly outlook back a little bit here to see if things can calm down around this Brexit and everything that’s going on. The extension letter has been sent. It’s my understanding, and the vote is being put off to Tuesday. This could be viewed as positive or negative for the British pound and for the equity markets in general, but they are going to be a driving factor to start the week.
And as you can see the dollar may be able to jump on that bandwagon and take advantage of that. So we want to watch this level very closely. Our predicted difference is already warning us that this thing is getting ready to turn around. So we want to be very, very cautious with shorts on the dollar to begin the week, and we should expect some strength, at least some strength here guys, towards the middle of the week on the dollar.
The Gold Market
Now with all of this volatility, gold remains firm. So if we look at this right now, again with the U S dollar index, our gold contracts here are trying to push higher. We can see a buy signal is forming. We’re not able to break above 50 on the predicted RSI. So it’s not there just yet, but always remember the dollar and gold can move up together for a short period of time. Usually no longer than about a week and next week it could definitely be that type of week. So we want to watch things very closely. But again, we’re going to see where we go with this.
Now we can see using the VantagePoint triple EMA cross, we have this resistance area at 1500. The market has been staying below that area this entire previous trading week, but we’re also holding firm on a very clear identifiable verified support zone. That I talked about in last week’s Forex weekly outlook. That’s coming in around 1478.00. Now, the much bigger area that I’m concerned with is down in this 1465.00 area. If we get a positive outcome on Brexit come Tuesday, I’m still not convinced we’re going to get that, but if we do, that we’ll put a little bit more downward pressure on gold in the short term. But watch for a reversal higher. Right now. This Brexit deal does not look great here to me that anything is going to be resolved. So we’ll wait and see, but be very, very cautious.
Now the next move on the S&P 500 is likely going to be determined by this Brexit announcement. As you can see, we’re backing away from this verified zone. We’re not even able to come up and test this area at 3024.00. Once again, it’s going to be very repetitive this week guys, I’m going to be saying this a lot in this video. If we get a positive outcome on Brexit by mid week, then that should boost equity demand, and we should see the S&P 500 in the European equity markets move higher. But if we don’t get a positive outcome on Brexit, be very cautious buying this. Either way, I feel that this is a very good short up in this particular area and the S&P 500 and the global equity markets are on life support here to begin with.
So if there’s any negative outcome for Brexit, this thing will go down basically pretty hard and pretty fast. It won’t go down like a set of stairs. It’ll will more or less go down, probably like an elevator, a crashing elevator. So be careful of this for now, but again, a lot of this is based around that outcome. When we look at oil going into next week, oil also moving higher, but it’s moving higher with equities, but it’s not really going anywhere, 54.14. That critical VantagePoint level, we’re unable to break through that area, so we’re holding there.
If equities pop higher than oil, we’ll go a little bit higher too. But not a lot. We can see our medium term crossing are longterm predicted differences trying to cross to the downside, but the neural index is stubborn on this one. So is the predicted RSI. Neither one are showing upward momentum on either. So still a biased. Once we get past the Brexit stuff and everything, then we’ll see where we go. But oil predominantly does not do very well at this particular time of the year.
Now as we get into some of our main Forex pairs. Before we do that, I still want to make sure that each week we’re at least discussing Bitcoin because it is worthy of at least a discussion. We have a lot of support down here in this particular area. Now, excuse me, that particular area is pretty heavy down in and around this 7704.00 area. I’m just going to highlight it right here. A lot of support on this particular, on the GBTC, but again GBTC is the stock. We want to make sure we’re looking directly at Bitcoin contracts to see what Bitcoin’s doing and this support that I’m talking about is sitting at or about the 7783.00 area.
So again, I would still be a buyer, why we’re above here, but if we break down and lose this area. We could see a much bigger sell-off on Bitcoin. So again, we’ll monitor this area very closely. The VantagePoint indicators are not confirming just yet that we’re going to have a breakout to the downside. You can see the predicted RSI trying to rise higher here. So we’re going to monitor this, but again, right now we have still seen to date a lot of people still buying Bitcoin on a dip. So we’ll continue to monitor this for now. But again, that level around this 77 mark, we want to really be careful down around this area shorting.
Forex Weekly Outlook for Major Pairs
Euro/U.S. Dollar (EUR/USD)
Now with the Euro, the Euro obviously is benefiting from the Brexit announcements this past week, but we’re stalling on this verified support or verified resistance area, excuse me, 1.1163. And we’re just hanging right there. Our major support levels are coming up all around this high, around 1.1249. It’s going to be very difficult for the Euro pair to break through here without a positive announcement on Brexit. We are already grossly overbought on this particular pair, 93.7 on the predicted RSI. Couple that with the monthly seasonality of dollar strength, the Euro again is on life support up here.
Now that’s not to say that it can’t break higher and start a new trending move to the upside. But again, this is all dependent on something that’s outside of our control, which of course is Brexit. So again, be very careful. This Brexit announcement is going to affect commodities, equities, currencies. It’s going to have a global effect on how all these things move. So we want to wait and see how this vote goes on Tuesday before we take any large bets on any of the currency pairs or the commodities or the equities.
U.S. Dollar/Swiss Franc (USD/CHF)
Now when we look at that, the U S Swiss Franc, again the Swiss Franc by itself with the Japanese yen is a leading, not a lagging indicator for the global equity markets and the commodity markets. The U S Swiss Frank has already sold off here. That suggests that the equity markets are getting ready to follow very soon. So again, in a risk on environment, people are selling the Swiss Franc. In a risk off environment. They are buying the Swiss Franc. So it would look to me that the global equity markets moving higher. It’s an illusion here guys. That big money is already moving out into here into currencies like the Japanese yen, like the Swiss Franc, so we want to monitor these. Again very, very closely. Now the U S Swiss Franc is oversold. We are expecting U S dollar strength. This could very well bounced, but it would need the global equity markets moving higher also.
British Pound/U.S. Dollar (GBP/USD)
So when we look at the British pound, the British pound right now by my calculation is up about 29% across the board, not just in the pound dollar, but all of the pound cross pairs too. The pound is grossly, grossly overbought here. Okay? Now again, that doesn’t mean it can’t go higher, but it usually means we’re going to correct lower first. We have two critical VP levels that will tell us where it’s going to retrace to. The first level, 1.2559. The T cross long, which is a major level.
If we look at our F8, that key pivot area on a day to day basis, you can see using just the VantagePoint predicted moving average. Every day, it likes to come back and test this level. That current level is 1.2780. So on this slightly positive news that I’ve waited until Sunday to do this weekly outlook specifically to see if we could get a little bit of resolution on Saturday. We did. So I’m thinking it’s going to be positive. We get another spike up on the pound dollar off the open, but then we come back. When we come back, this is the area you want to watch, 1.2790. You can see here that despite this big move up, the VantagePoint, medium term crossing the longterm predicted difference is already warning us. We’ve got a problem up here. Okay? And on top of all of that, if that’s not enough for you guys, we’ve got a verified resistance zone that’s coming in at or about the 1.3170. So 1.3170 is in our crosshairs right now. But then we have to reassess and see if we can continue to move past that particular level. My optimism on that at this particular time remains heavily guarded.
U.S. Dollar/Japanese Yen (USD/JPY)
Now when we look at the dollar-yen going into next week, you can see as I’ve talked about over the last couple of weeks, major verified resistance up here, up to 109.31. A positive Brexit would absolutely send us up to 109.31, where we would be happy sellers here and I believe that most of your major funds will be looking to sell dollars against the yen up at that particular area, also. Remember that the U S dollar is not the most popular currency in the Asian block. China and Japan no longer use the U S dollar to settle their respective trade balances. So there isn’t the same kind of dollar demand over there that there once was. Keep that in mind guys. Very, very important. So our eyes are on the this level between 109 and 109.50. We’ve got a sell signal in place. The medium-term crossing, the longterm predicted difference, the neural index of falling RSI. All of these are telling us that dollar yen is likely going to go lower, but it may go higher, first guys, if the Brexit outcome is positive.
The Commodities Currencies
Australian Dollar/U.S. Dollar (AUD/USD)
Now if the Brexit outcome is not good, the equity market sell off. That is going to have a major effect on our equity or commodity-based currencies, which is U S CAD, Aussie U S, New Zealand, U S. So some potential opportunities for some very nice reversal trades here next week. We’ve got a very strong level of support in this verified level down here at 1.3105. If this is going to reverse, it will be between 1.3105 and 1.3014. This would basically be our buy zone down here. The indicators from VantagePoint are already warning us of a potential reversal coming. If Brexit fails, it turns into another mess over there in the U K. Than U S Canada will go higher, not lower, and again, oil sells off. U S Canada goes higher, not lower. This is what we want to watch for. The same thing next week. We can apply those same levels. If we look at the Aussie U S pair, we can see a very major resistance level here coming in at 0.6894. Now again, we’re moving into a moderately overbought condition at 81.9. We still probably got a little bit of upside if we get a positive. The market reacts positively to this newest development with Brexit, but quite frankly, I’m really getting tired of hearing the word Brexit. It really is starting to become a nuisance here. I would love to see it get resolved sooner rather than later and put this thing to bed once and for all.
New Zealand Dollar/U.S. Dollar (NZD/USD)
So until that happens, guys, we’re going to see heightened volatility Sunday and Monday. Be very careful, but if we get a big positive spike up, watch for a reversal on Tuesday on this pair around the 69 mark. The same thing would apply to New Zealand U S guys. When we look at that, we’ve got a big, big resistance level up here at 0.6450. We want to watch and see if we can push above that. But if we start failing around that particular level, they aforementioned level than shorts would be potentially could be a very, very nice trade here.
So again, we’ve got a lot of volatility coming in next week and we just have to make sure that we’re not just buying high or selling low. We have to monitor these major event risks. So with that said, this is the VantagePoint AI Market Outlook for the week of October, the 21st 2019.