Price & Time: Trend Resumption in the Precious Metals?

This publication attempts to further explore the concept that mass movements of human psychology, as represented by the financial markets, are subject to the mathematical laws of nature and through the use of various geometric, arithmetic, statistical and cyclical techniques a better understanding of markets and their corresponding movements can be achieved.

Foreign Exchange Price & Time at a Glance:

USD/CHF:

Charts Created using Marketscope – Prepared by Kristian Kerr

-USD/CHF has rebounded strongly over the past few days since finding support from just under the 3rd square root progression of the year-to-date high in the .9275area

-Our bias remains higher in the exchange rate with immediate focus on the 3x1 Gann angle line from the year-to-date high near .9415

-Traction over the 1st square root progression of the year’s high at .9470 is really needed to signal the a resumption of the broader uptrend

-A minor cyclical turn window is seen over the next couple of days

-The 1x1 Gann angle line from the year-to-date low at .9360 is immediate support, but only weakness under .9275 level turns us negative

Strategy: Favor the long side while over .9270.

USD/CAD:

Charts Created using Marketscope – Prepared by Kristian Kerr

-USD/CAD has come under steady downside pressure over the past few days and touched its lowest level since mind-February on Tuesday

-Our bias is lower, but the exchange rate is approaching a key support zone in the 1.0015/35 area as this marks a convergence of the 3rd square root progression from the year’s high and several key retracements

-Weakness below this key zone is needed to maintain the downside tack

-Near-term time cycle analysis suggests the end of the week is a medium-term turn window

-The 1x1 Gann angle line from the year-to-date high in the 1.0100 area is now resistance and only strength above this level undermines the immediate negative technical tone

Strategy: Short positions favored while under 1.0100. Caution required, however, as we apporach potentially pivotal support in the 1.0015/35 area.

GBP/USD:

Charts Created using Marketscope – Prepared by Kristian Kerr

-GBP/USD has found formidable resistance over the past week at the 50% retracement of the year-to-date range in the 1.5585 area

-We remain positive on Cable, but a close over 1.5585 is needed to trigger another push higher towards 1.5650 and above

-Near-term focused time cycles are a bit muddled, but a turn window is seen around the first half of next week

-The 38% retracement of the April advance in the 1.5450 area is immediate support

-However, weakness below the 50% retracement of the same move near 1.5405 is needed to signal a broader downside resumption

Strategy: Looks to be nearing an important juncture. A break of 1.5585 is needed soon if this counter-trend move is going to continue.

Focus Chart of the Day: Silver

Several cycle counts we follow suggest the next couple of days will be important for spot Silver and a turn could materialize. Given the metal is in the midst of a minor counter-trend move higher this turn window should lead to a resumption of the broader downtrend. The 38% and 50% retracements of the late April decline at 24.40 and 25.10 look like key resistance as does the 6th square root progression of the year-to-date low at 24.80. On the downside the 50% retracement of the 3-week long advance near 23.45 looks like immediate support with weakness below there needed to signal the start of a downside resumption.