Currency Markets

Currency Weekly April 24, 2022

Apr 24, 2022

Thomas Thornton

Highlights and themes

The US Dollar strength continues as a safe-haven hiding place. Sentiment is as stretched as it gets with the major US crosses. Several DeMark exhaustion signals with Euro, Swiss Franc, Yuan, and the Yen crosses are coming into play. I have to access my Sterling long position this week. I will have updates on the notes all week.

Currency Sentiment Overview

Currency sentiment highlights still have the US Dollar strength as the main theme. It’s remarkable.

US Dollar Indexes

DXY US Dollar Index daily has the cluster of DeMark exhaustion signals but a potential new secondary Countdown might continue this even more with the upside wave 5 price objective just above. The US Dollar safe-haven trade is the one trade that has been unrelenting

DXY US Dollar Index weekly still has the Sequential in progress

Bloomberg US Dollar Index daily also had some daily signals that haven’t turned lower and now at the upside wave 5 price objective

Bloomberg US Dollar Index weekly has a new Combo sell Countdown 13 following the Sequential.

US Dollar bullish sentiment at 93% is VERY rare historically

US Dollar Commitment of Traders shows large speculators increasing long exposure

Bitcoin and Ethereum

Bitcoin now looks vulnerable to the downside with a Sequential starting on the downside The TDST at 38,142 is major support. If shorting use 42,000 as a stop (I know it’s wide but this is Bitcoin)

Bitcoin Bullish Sentiment also dropping hard and can and might go back to lows

Ethereum still has the pending Sequential however this looks terrible as well making new recent lows

Major USD Crosses

EURUSD Euro / US Dollar needs one more down day to get the Sequential buy Countdown 13

Euro bullish sentiment remains under pressure

Euro Commitment of Traders shows speculators decreasing long exposure

GBPUSD British Pound Sterling / US Dollar breaking and I might reassess my long position

British Pound Sterling bullish sentiment remains under severe pressure

British Pound Sterling Commitment of Traders

AUDUSD Australian Dollar / US Dollar

Australian Dollar bullish sentiment breaking lower again

Australian Dollar Commitment of Traders shows speculators mostly unchanged and still short

USDCAD US Dollar / Canadian Dollar

Canadian Dollar bullish sentiment is breaking down again

Canadian Dollar Commitment of Traders shows speculators increasing long exposure

USDCHF US Dollar / Swiss Franc should get the Sequential 13 this week

Swiss Franc bullish sentiment remains under severe pressure at 7%!

Swiss Franc Commitment of Traders shows speculators covering some of the short positioning

RISK On Risk Off

This cross is often used as a risk-on / risk-off indicator

EURAUD Euro / Australian Dollar

Three major Yen crosses – extended

EURJPY Euro / Japanese Yen

GBPJPY British Pound Sterling / Japanese Yen

AUDJPY Australian Dollar / Japanese Yen

US Dollar vs Emerging Markets

USDTRY US Dollar / Turkish Lira

USDBRL US Dollar / Brazilian Real

USDMXN US Dollar / Mexican Peso

Mexican Peso bullish sentiment reversing lower after peaking shortly in the extreme zone

Mexican Peso Commitment of Traders shows speculators increasing long exposure

USDZAR US Dollar / South African Rand

USDCNH US Dollar / Chinese Offshore Renminbi (Yuan)

DeMark Sequential Basics from Bloomberg

More detailed Commitment of Traders explanation