Levels to watch with next week’s US Election.

Next week’s US Presidential Election could trigger huge swings across stock and currency markets. Thus, given the potential for such a shift, I have kept this post rather brief and focused on the key S/R levels that are constraining many trading instruments.

Range-bound: a number of Forex pairs remain range-bound on longer time frame charts leading up to next week’s US Presidential election. Examples include:

  • triangles: on the EUR/JPY, AUD/USD, AUD/JPY, EUR/NZD.
  • wedges: on the EUR/USD and NZD/USD.

Recent breakouts: Some FX pairs have recently broken out of range-bound patterns BUT there has been little weekly-chart momentum associated with these moves as yet. Examples include:

  • the USD/JPY, USD/CAD and EUR/AUD

Volatility: has certainly picked up of late but, under the circumstances, this isn’t as high as one might have imagined:

VIX weekly: the ‘Fear’ index has put in a large bullish weekly candle but is still below 30 for now and, perhaps surprisingly, has not spiked as much for the week as one might have expected given the looming US Election:

vixweekly vixweeklycloud

S&P500: the daily chart shows this has breached the 50% fib so watch for any make or break at the 61.8% fib.

S&P500 daily: watch for any make or break at the 61.8% fib:

spdaily

S&P500 weekly: watch for any test of the longer-term support trend line:

spweekly

S&P500 monthly: bearish divergence recently faded:

spmonthly

S&P500 multi-year: I have been looking for a test of the 1,600 breakout level for the last couple of years and couldn’t imagine an event to trigger such a pullback. I do wonder whether a Trump victory might be a suitable catalyst to achieve such an outcome though?

spx70years

Forex:

USD/MXN weekly: how could I have forgotten this pair! Any potential Clinton win might see this trend line threatened. If so, watch for any test of the 61.8% fib down near the weekly 200 EMA:

usdmxnweekly

EUR/USD: The 1.12 level is key here as it is the 61.8% fib of the longer-term swing high move so watch for any make or break from this level. As well, price has been range-bound within a wedge framed by 1.045 and 1.15 so watch these levels for any make or break as well.

eumonthly euweekly eudaily

EUR/JPY: watch the smaller triangle trend lines on the daily chart time frame and the 115 level for any make or break activity:

ejmonthly ejweekly ejdaily

AUD/USD: watch the triangle trend lines on the daily chart time frame for any make or break activity:

aumonthly auweekly audaily

AUD/JPY: watch the triangle trend lines on the daily chart time frame and the key 80 level for any make or break activity:

ajmonthly ajweekly ajdaily

NZD/USD: watch the wedge trend lines and 0.74 level for any make or break activity. Check how 0.74 has been a barrier on the weekly chart so any weekly close above this level might be a game changer.

kiwimonthly kiwiweekly kiwidaily

USD/JPY: this pair has broken out from a long-term descending trading channel but weekly momentum has not picked up as yet. Watch for any make or break of the 101.5 – 100 S/R region:

ujmonthly ujweekly ujdaily

USD/CAD: this pair recently broke up and out from a rising wedge but momentum has yet to kick in here as well.

looniemonthly loonieweekly looniedaily

GBP/USD: This pair remains a challenge due to the on-going Brexit issues as well as US$ volatility associated with next week’s US Election.

gumonthly guweekly gudaily

EUR/AUD: there has been a monthly triangle breakout and price is currently pulling back to test this trend line. Thus, watch for any make or break at this trend line or the recent 1.44 support level:

eamonthly eaweekly eadaily

EUR/CAD: I’d suggested this might head back to test 1.50 and this is what we’ve got. This is the level to watch for any make or break in coming sessions:

ecmonthly ecweekly

ecdaily

EUR/NZD: watch the triangle trend lines for any make or break activity:

enmonthly enweekly endaily

EUR/GBP: This pair recently printed a bearish-reversal ‘Evening Star’ pattern. I still think the 0.89 level is the one to watch for any rejection to bounce higher or move lower. Price closed just below this for the week so keep watch for any decisive make or break activity:

egweekly