Welcome to the Artificial Intelligence Outlook for Forex trading.
VIDEO TRANSCRIPT
Okay, hello everyone, welcome back. My name is Greg Firman, and this is the Vantage Point AI Market Outlook for the week of December 9, 2024.
U.S. Dollar Index
Now, to get started this week, we’ll begin where we always do with that very important US Dollar Index.
Now, what is critical is that we have proper anchor points in our trading. We don’t want a random five days or random 30 days; we’re starting a new trading month, and it’s very important that we measure performance accurately. The dollar is basically flat after another very weak payroll number. This is likely going to trigger a rate cut this month from the Fed. The U6 is rising, the unemployment is rising, the U3 number in the US was just okay, but remember, that’s a household survey number. So, the dollar, responding to that, recovering somewhat on Friday. But our T-cross long, that area is critical to watch this coming week. Between our T-cross long and our long predicted, we have significant resistance, just above, just below, excuse me, 107, about 106.80. So, as long as we’re holding below that level, the dollar should remain weak. The major event risk coming out for next week, of course, is the CPI number, but I don’t think the CPI is going to be able to offset the last two payroll numbers, and it’s likely, again, the dollar to follow that strong seasonal pattern in the month of December, remains possible here that we can move significantly lower on the dollar. But again, we must stay below that 107 level. .
Gold
Now, when we do a comparative analysis to gold, gold we can see is down very slightly, 0.47. Now, you’ll notice where I’m taking my anchor point from, the very beginning of December. We don’t want to go back before that because then we would be commingling months, and it can distort true performance levels
So gold struggling a little bit up here, but I believe if we can get above our T-cross long at 2644, that that should push gold higher with the CPI number probably becoming a little softer, uh, triggering more rate cuts that should help our gold contracts. But again, we must get above 2644. Our MA diff cross is running sideways; you’ll notice the predicted RSI running along the 40 level. Now, the 60-40 split in the predicted RSI, I’m only looking for momentum from the RS predicted RSI, nothing more, not overbought, not oversold, do I have momentum building to the downside by the indicator? No, I do not. So again, if we can get back up above the T-cross long, get the neural index turning positive, then gold should move higher into the end of the month and into January.
S&P 500 Index
Now, when we look at the equity markets, now this is where things on an intermarket analysis standpoint become very interesting. The S&P 500 is not up 5% over the last 30 days, uh, again we’re not going back into November guys, we always look forward, not backwards, so the true performance of the SPYs and the S&P 500 is very minimal this week and this month because we have a new weekly opening price and a new monthly opening price, .71%. So, for the S&P to remain bullish, we need to stay above our T-cross long at 59.96. Now, when we do that same comparative to the SPYs, we can see the exact same thing. Now, if I come back here and I say, well, you know, I’m going to go back a random 30 days, I’m going to put this up here and say, well, it’s up x amount, it’s up, you know, I could say well, it’s up 6%, but that would be cherry-picking a point in time that has very little relevance to what the market is currently doing in the month of December; it’s struggling here at .71%.
DAX
So, when I do a comparative analysis to the European Equity Markets, they have done very, very well this past week, up 3.87%. So, you looking at that comparative, I would say okay, either the DAX is getting ready to move lower and, as you can see, we have an MA Diff cross occurring right here which is warning us that means the S&P 500 is nowhere potentially is not as strong as what it appears to be. So again, when we look at that, the further the market moves away from the Vantage Point T-cross long at 19,673 the more likely it is we’re going to retrace back to that area.
So, this coming week, we could see some volatility in the US Equity markets based on what I’m seeing using the European Equity markets to gauge that.
Volatlity Index ($VIX)
Then to cross-reference this with, of course, the VIX, we can see that the VIX is finally broken down below its yearly opening price. This does give us hope that we can have a Santa Claus rally in December, but I think there’s going to be some volatility to the downside first.
Bitcoin
Because when we look at probably again, the top investment so far this month remains in Bitcoin, uh, Bitcoin has had another significant year. Last year, I believe we were up about 155%; now, this year we’re up, I believe, the same or even more. So, with Bitcoin, this past week, we’ve, it has been very choppy in there, but you can see on Tuesday we had a retracement exactly to the T-cross long, 93536. Now, using the single predicted moving average to gauge whether the market is bullish or bearish, this is about as objective as it can get, then we layer in the current yearly opening price, the current weekly and monthly opening price. So again, you can’t get proper performance if you move your anchor point off of the current month. So, I need to gauge if I have momentum building to the upside in Bitcoin in December so far it does, but if I, if I move that anchor point to a random 30 days back here, then one could just say, oh, it’s super bullish when an actual fact it may not be. So again, it’s always good to use current pricing like the weekly, the quarterly, the monthly, and the yearly opening price. Bitcoin right now, the quarterly opening at 63,800, the current yearly opening price 42,501 showing the structural bias of Bitcoin is very strong. Then we layer in the T cross long, we look for our retracement points and our anchor points to buy from. These are current retracement points that have nothing to do with conventional theories like Fibonacci, things of this nature, it’s a point in time that we look for that retracement. If we can hold above that, then it tells us we’re still bullish.
Euro versus U.S. Dollar
Now as we enter into the main FX Market, again the dollar taking a bit of a hit this past week, uh, based around that payroll number, but again, you can see that the market is struggling with the current monthly opening price that’s 10,574, we’ve barely closed, we’ve closed just a hair below that. So you can see that we’re, we’re fighting it out right along this particular line. Now again, if I move that to a non-current month and use that as a monthly opening price, it would cause distortion. I want to make sure I’m staying current in this particular scenario. The VPT cross long is at almost the exact same level as the weekly and monthly opening, so whether you’re a bull or a bear, everything is happening right here. If we can hold above our T-cross long at 10,570, the bulls will take control of this. There’s a high ability because of that seasonal pattern in the month of December, but if we can’t hold above that, then the seasonal may not be in play. So I always like to give something to the bulls and the bears because again, everybody trades differently and does things differently, but the main thing is we want to agree on where the action is occurring, where the breakout is going to occur from. So in most cases, the Monday after the non-farm payroll number is not a true price, and on Tuesday things reverse. So again, if we see a big move down on the Euro on Monday, then the probability is it’s going to go higher on Tuesday. Just be very cautious of that payroll number, or excuse me, the CPI number which I believe is out on Tuesday.
U.S. Dollar versus Swiss Franc
Now the US-Swiss Franc once again showing that dollar weakness where we discussed last week, we had a newly formed verified resistance high at 88.90, that continues to hold. We do have a two-day close below our T-cross long, we’re closing below our monthly opening price, so again 88,05 T-cross long at 88,18, shorts are in play while below that level. If you believe that the dollar is going to strengthen, then you would buy, make sure your longs are executed above 88,20 because again, we’ve got that line in the sand here, and again, there is some signs of life with the neural index strength, we can see the predicted RSI, but predominantly, I believe the Swiss Franc will remain dominant against the dollar. So this is one of the better years I will concede that the dollar is head against the Swiss Franc, and I can say that by looking at the current yearly opening price which is 84,10, so the dollar is actually done fairly well against the Swiss Franc this year, but the further we move away from that current yearly opening price, the more likely it is we’re going to start retracing back to it.
British Pound versus U.S. Dollar
Now the Pound-Dollar this past week and going into next week again a very interesting setup here, guys, our Tross long is hovering just below the current calendar yearly opening price again, I don’t want to pick a random 30 days, a random 90 days, I need proper anchor points in my trading. The start of the week, the start of the month, the start of the quarter, the start of the year, and then lock those prices in. So right now, all the battle lines are being drawn right along this line, so if the dollar seasonal pattern remains intact, then this pair would go up. If and again, 12714, the T-cross long but the yearly opening price at 12732, that’s the level we need to get above and stay above for this pair to extend. The indicators here are very mixed on that. We’ve got momentum on the predicted RSI, my concern is that MA diff cross, that pink line over the blue line, and that neur index while the neural index is green, the neural index strength, excuse me, is very decisive in the angle in which it’s pointing, which is down. So I suspect the initial move here out of the gate on Monday will be down, but Tuesday, Wednesday, Thursday, we could see a complete reversal back to the upside. The key thing, guys, know your levels, 12732, we’re above that, we’re long, 12732, we’re below that, we’re short, that’s the play here, guys.
U.S. Dollar versus Japanese Yen
Now when we look at the Dollar Yen, uh once again, the carry trade struggling here as the Fed is getting backed into a corner on these rate cuts, they can keep spinning the reports as much as they want but the reality is the labor market is not strong, uh, the, if it was strong the U6 number would be going down, the unemployment rate would be going down, uh, we can’t gauge the broader unemployment in the US based on a household service, U3 number, uh, when we dig deeper into that report, there’s problems in that report, and there has been for some time. We still have a million jobs we’re missing from the previous administration that haven’t been accounted for, right? So right now on the Dollar Yen, the Tross long is coming in at 15173. If we get a softer CPI number, then this pair is going to crash significantly because people will look to exit that carry trade, meaning long the dollar short a low-interest rate currency like the Yen. So be this pair is going to see some volatility this week, but as long as we’re below 15173, shorts remain in play.
U.S. Dollar versus Candian Dollar
Now the US-Canadian pair really taking a hit on Friday with another terrible jobs number out of Canada, while they boast that there was 51,000 jobs when you look inside that number it shows something very different. So again, uh, the market responding to that, uh report, we have a verified resistance high, 14,178, it’s been many, many years since I’ve seen the Canadian dollar this week, uh, and I think it goes all the way back to when Trudeau’s father was in power, we did get to this level in covid times but right now this is based on a very concerning uh Canadian economy, uh, with the oil sector, a lot of these different carbon taxes, Etc so Global investment into Canada it’s not doing as well as what we would hope, but for now, this is the level to keep your eye on, despite everything that’s going on in Canada if the dollar follows its seasonal pattern, then it would weaken and that would still boost the Canadian dollar even with that report, so we’ll keep a very close eye on this particular level, but right now, the VP indicators are suggesting we could go higher, but I think it’s very, very unlikely at this time. I think we’re going to trace back down into this 140,19 probably by the end of the week we will see how this plays out, uh, whether the the season, the US dollar can buck the seasonal trend of weakness.
Australian Dollar versus U.S. Dollar
Now with the Aussie and the Kiwi uh, tough week for both of these two with what’s been going on in uh, with the uh, martial law in South Korea, they immediately had a very negative reaction to that, but uh, there is no the I believe the at the time of the presentation here that there was there’s not an impeachment, things should settle down there, uh, I believe the Aussie and the Kiwi will be good long trades in 2025 and 2026 but for the immediate uh, the fundamentals of what’s going on politically in South Korea is is definitely affecting the Aussie and the Kiwi so we’ll continue to monitor what’s happening over there, but for now, a T-cross, u a retracement to 64,990 the T-cross long does remain imminent and one of the ways I look at that is I will click on my f8, and my f8 here, all I need to do is get above that level at 64,43, if I can get above 64,43 then I know I have a chance of extending higher.
New Zealand Dollar versus U.S. Dollar
Now the same thing will happen with the Kiwi here, uh, if you can see it testing that T-cross long, now if we get above 58.87 then we could have longs here, so another busy week, uh, another choppy week coming with the US CPI but with that, there will be opportunity. So again, this is the with that said, this is the Vantage Point AI Market Outlook for the week of December 9, 2024.
