Weekly Outlook: 2015, January 25 - February 01

S&P 500 fell initially during the course of the week but found enough support near the 2000 level to turn things back around and smash into the 2060 level. That’s an area that has little bit of resistance, but ultimately we believe that if we get above there the market should then head towards the 2100 level. The market is most certainly in an uptrend, so we have no interest in selling anyway. Pullbacks should offer buying opportunities but you may have to look at shorter-term charts in order to find the correct candles.



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The silver markets broke higher during the course of the week as you can see, clearing the $18 level. That of course was an area of resistance, so it makes sense that we would continue to go little bit higher. However, the $19 level above is resistive as well, so we could get a little bit of a pullback. This has been a rather strong move higher and we believe that there is quite a bit of bullish pressure underneath, so we look at pullbacks as potential buying opportunities. However, this is a market that might be easier if we trade off of the shorter-term charts.



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Gold markets tried to rally during the course of the week, but as you can see the $1300 level offered a bit of resistance and ended up forming a shooting star in this market. With that being the case, we feel that this market will more than likely pullback from here. We believe that there is a significant amount of support down at the $1250 level though, and most certainly at the $1200 level. With that, we are still in a bit of a downtrend, and with that you have to be careful. Ultimately, this is a market that is probably better off being traded on shorter-term charts.



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The USD/JPY pair initially broke higher during the course of the week, but turned back around at the 119 level to form a bit of a shooting star. Ultimately though, this is a market that is very much in an uptrend, and should continue to go higher. We believe that the 115 level is the “floor” in this market, and as a result we look at pullbacks as potential buying opportunities. We have no interest whatsoever in selling this market, and do believe that eventually we break back above the 122 level and grind our way up to the 125 handle.



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The USD/CAD pair broke much higher during the course of the week, using the 1.20 level as a springboard to reach close to the 1.25 handle. This of course was exaggerated by the Bank of Canada cutting interest rates in a surprise move this week. Ultimately, we believe that the Canadian dollar is on its back foot now, and should continue to be sold. However, we recognize that we are approaching a significant round number, so we could get a little bit of a pullback. Think of pullbacks as potential value in the US dollar and therefore buying opportunities.



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The GBP/USD pair broke down during the course of the week, crashing into the 1.50 handle. Ultimately, it looks like the buyers are just below, and we do believe that there is a significant amount of support going down to the 1.48 level as well. That being the case, we feel that the market should continue to be one that is supported below, and as a result we are waiting to see a buying opportunity. The Friday candle was a hammer, but from a longer-term perspective we do not have that signal quite yet.



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The EUR/USD pair tried to rally at first during the course of the week, but with the European Central Bank expanding its quantitative easing program, we broke down below the 1.15 level and then crashed all the way down to the 1.11 region. We believe that the market is now heading to the 1.10 handle, and rally should be sold. It’s probably going to have to be done off of the daily charts or even lower time frames though, as longer-term charts don’t offer a lot of room between here and 1.10 at the moment.



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