The charts and overall technical analysis points towards the possibility that the volatility could be coming back with a bang, just like it did in the beginning of February, when global Indices seriously dipped to unexpected lower grounds.
March was filled with wild swings, with multiple fundamental events and uncertainty, causing complex corrective structures and overall bigger consolidations. These swings were explained previously in our “Surfing The Waves Analysis Performance – NFP Webinar Invitation” video.
April was favorable for the USD, volatility in the green-back translated into a bullish rally which, at this time, is showing the possibility of dying out. We went over this in “The Return Of The Dollar Bulls” & “Is The USD Getting Stronger?”.
May likes Volatility, and just to prove it, there are multiple correlation signs that the market could be preparing for some wild swings, as the corrective patterns seem to be synchronizing for some possible impulses. These technical set-ups were mentioned in the previously posted “USD Bearish View – Corrective Patterns And Analysis Update” video, but also during our live NFP webinar; “Trade Like A Jedi On The NFP”.
What kind of waves could the Market be preparing and what are the opportunities on the radar?
Technical Analysis – Elliott Wave Perspective
The CBOE Volatility Index (VIX) spiked in the beginning of the year, letting investors know that complacency period was a thing of the past and that volatility could be shifting towards the “fear” zone. Since then, VIX retraced on the down-side but technically speaking, it could surprise once more due to the possibility of another spike of volatility from the previously breached 13.00 Vibration Levels.
VIX – Weekly Chart
The Dollar Index (DXY) was of course analyzed and updated with multiple articles and videos, as per the links mentioned above.
It seems that the Bullish Rally could be completing, and according to the current wave count, the extension might be showing signs of weakness.
DXY – 2H Chart
Bearish signs:
- Fibonacci Extensions of multiple degrees of labels possibly aligning at or around the 00 Vibration Levels and Golden Ratio.
- Bearish Divergences gaining accents
- Ending Diagonal possibility
EUR/USD – 2H Chart
Bullish signs:
- Fibonacci Extensions of multiple degrees of labels possibly aligning at or around the 18550 Vibration Levels.
- Bullish Divergence possibly forming
- Ending Diagonal possibility as the Reversal Pattern
GBP/USD – 2H Chart
Bullish signs:
- Fibonacci Extensions of multiple degrees of labels possibly aligning at or around the 3300 Vibration Levels.
- Bullish Divergence possibly forming
- Ending Diagonal possibility as the Reversal Pattern
USD/JPY – 2H Chart
Bearish signs:
- Possible Head & Shoulders formation
- 8% Fibonacci Retracements of previous bearish swings show a reaction
- Bearish Divergence possibility
USD/CHF – 2H Chart
Bearish signs:
- Bearish Divergence possibility
- Double Top probability, of previous bearish trend beginnings
Crude OIL (WTI) – 2H Chart
Bearish signs:
- Ascending Channel retesting the upper trend-line
- Bearish Divergences gaining accent
- Fibonacci Extensions of multiple degrees of labels possibly aligning at or around the 00 Vibration Levels.
XAU/USD (Gold) – 2H Chart
Bullish signs:
- Fibonacci Extensions of multiple degrees of labels possibly aligning at or around the 00 / 1285.00 Vibration Levels.
Many pips ahead!