NASDAQ 100
The Nasdaq 100 has been negatived for the week as we continue to see a lot of struggles near the 30,000 level. Quite frankly, it's probably a mix of technical analysis and the fact that traders really have no idea where the economy's going right now, as so much of it is driven through the prism of what's going on in the Middle East.
And now we have the US Treasury out there looking to buy back in large amounts the 30-year bond next month. We'll have to see whether that ends up mattering, but as things stand right now, it seems to have spooked the market a bit. I do believe at this point in time, though, the market is still very much in an uptrend and not much has changed from a longer-term standpoint.
NZD/USD
The New Zealand dollar has rallied as well but is facing significant headwinds just above the 0.60 level and extending all the way to the 0.61 level.
The New Zealand dollar is going to be a little healthier than some other Asian currencies because the central bank is thought to be a bit more hawkish, but at the end of the day, the interest rate differential still favors America.
Gold
Gold markets have rallied quite nicely, jumping above the $4,500 level in a very positive sign.
Ultimately, this is a market that is likely to continue to be noisy because of all of the different things that are going on from a geopolitical standpoint and, of course, the fluid situation with Treasuries now. Overall, this is a market that has been in a long-term bullish trend, and it looks like it is starting to continue.
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WTI Crude Oil
The oil markets continue to be very noisy in general, and they quite frankly should be considering that we still don't know what the next headline coming out of the Middle East will be.
But recognize that it could very well end up being very scary. The markets continue to see a lot of volatility, and I do believe that over the longer term, oil is probably a market that will continue to find a bit of a bid due to all of the fear and the potential lockdown of supply out there.
DAX
The DAX in Germany continues to be an area of contention as we have seen a lot of questions asked about the energy supply for Europe this winter.
If that continues to be a concern, that could be a negative for the DAX as the overall economic engine that is Germany is quite often driven by industrial output. It looks like the 26,000 level is going to continue to be an area that traders pay attention to.
USD/JPY
The US dollar has been all over the place against the Japanese yen during the trading session on Friday, finishing off a week that has been just as noisy. Ultimately, the 160¥ level above offers a bit of a barrier that I think traders will be cognizant of.
The market continues to be one that pays close attention to the idea that the Japanese may intervene, but so far there hasn't been much talk of it since the last time. Overall, I do believe that the carry trade will continue to be attractive for some traders as we continue to see interest rate differentials between the two currencies widen.
USD/MXN
The US dollar has fallen against the Mexican peso, and again this is another currency interest rate play as traders run to the Mexican peso for its higher yield.
But it'll be interesting to see how long this lasts because if we do get some type of financial crisis, this will reverse rather rapidly. It’s a strong downtrend that I remain bearish in.
EUR/USD
The Euro has rallied this week in reaction to the weak US dollar. It looks like the 1.19 level could be a target eventually, but we have to get through the 1.18 level first.
Short-term pullbacks at this point in time continue to look at the 50-week EMA as a potential support level near the 1.1550 level. Ultimately, this is all about interest rates and Treasuries as well.
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