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Market Update - September 23

Scandinavian Capital Markets

DJIA HOURLY

The Dow completed the short term head and shoulders top so focus is on the mentioned 25853 (then reassess). The bounce over the last 2 days should see resistance from the breakdown level near 27500.

9/20 – The Dow is testing critical support from the June high. This level has been support since 8/20. A break below would complete a head and shoulders top that’s been forming since early June. The measured objective would be 25853.

NZDUSD HOURLY

NZDUSD HOURLY

The NZDUSD drop from the 9/18 high is in 5 waves so respect potential for a snap back near .6700 before additional downside. .6550 and .6370/80 remain downside levels of interest. In summary, nothing has changed ‘levels wise’ but I wanted to take fresh look at NZDUSD before RBNZ (which is today).

9/21 – Kiwi broke below the trendline that originates at the 5/15 low. The underside of this line should provide resistance now near .6700. The next downside level of interest is the line off of the 6/30 and 8/20 lows near .6550 although .6370/80 looks like a magnet. This is the former 4th wave support shelf (6/15 low) and VWAP from the March low and 2020 VWAP (see futures chart below).

EURUSD 4 HOUR

EURUSD 4 HOUR

EURUSD turned down when it needed to and today’s drop completes the topping pattern that has been underway since late July. It’s not uncommon to get a slight bounce following a break of a larger pattern. If that happens here then 1.1780 should provide resistance. Downside focus remains 1.1450-1.1500 although the median line from the short term bearish fork could provide support for a bounce near 1.1630.

9/20 – EURUSD continues to churn around the upper parallel from the short term bearish fork. If the move is lower, then price should turn down now. This sentiment is reinforced by the the fact that price is testing VWAP from the high (see below).

GBPUSD DAILY

GBPUSD DAILY

Cable is nearing the mentioned 1.2580. Resistance from April at 1.2650 is also VWAP from the March low (see futures chart below). In general, be aware of 1.2550-1.2650 as a possible support zone. 1.2865/85 is near term resistance.

9/17 – GBPUSD bounced from just under the 6/10 high at 1.2814. Price is currently trading in ‘no man’s land’ but 1.3170 sticks out as significant resistance. This level is defined by the underside of the median line from the fork that originates at the September 2019 low. The spot to know for proposed support (maybe a few weeks out) is the 25 line of that fork, which was support in May and June, near 1.2580.

BRITISH POUND FUTURES DAILY

BRITISH POUND FUTURES DAILY

Scandinavian Capital Markets Review

Source: https://scandex.com/2020/09/market-update-september-23/
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