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January 15th 2019 - Institutional Market Observations

Updated: Jan 24, 2019

Many weeks have passed with the US government remaining shut down. With the CFTC has not released any position data since December 18, 2018. What we know is that there was a very specific theme that was playing out and it is very likely that theme continues till this day. Among one of the assets we have been following is Gold!

GOLD ~ Massive supply sitting on the monthly chart that was created by the institutions has been hit and when examining the trading of the big players we are seeing a pattern taking place here. With this supply being contacted it is expected to bring in a pressure to the downside in the months to come. Once the 1264's are taken out then the 1250's will be the next target. We have great expectations from gold this year that could likely become the trade of the year. This one will take some time to play out so patience is key.

You can read more about what we have discovered about gold here:

US DOLLAR ~ the first moves of the year for the dollar has been weakness and right before the holidays we had observed and determined that dollar weakness was likely what was coming leading into the new year. Now we have the ascending trend line on the weekly chart being broken which puts the ascending structure under jeopardy and could very well lead to more downside to come. A break of the 94.47 will open the pathway for a larger move lower.

$AUDUSD ~ the Aussie is one we've been watching closely and have determined is likely to get much weaker this year. There are strong supply forces pushing down on price and the recent move higher will be short lived. We will be watching for short signals on this pair and the Aussie cross pairs.

$EURUSD ~ the Euro dollar's weekly structure is still intact unlike the dollar but the descending trend line is under attack and if the 1.1622's are taken out then we'll likely see a bigger push upwards towards the 1.18's. There's no doubt the institutions are building a large short position and that we should be doing the same but for the short term we are watching for a move higher.

$GBPUSD ~ the pound dollar, leading up to the BREXIT vote has taken out an important area of supply by the institutions. must wonder what effect this will have after the vote. What can be observed at this time is that there is a tested area of supply higher, likely we see price move up to the 1.30's as that would be the natural path for price to take at this time.

Magic Trader!


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