Welcome to the Artificial Intelligence Outlook for Forex trading.
VIDEO TRANSCRIPT
US Dollar Index
Okay, hello everyone, and welcome back. My name is Greg Firman, and this is the Vantage Point AI Market Outlook for the week of February the 17th, 2025.
Now, to get started this week, we’ll begin where we always do with that very important US Dollar Index. Now, the Dollar Index remains below its calendar yearly opening price, but this past week is somewhat perplexing because the inflation data is considerably hotter, pointing, or at least suggesting, that the Fed is not going to be able to cut. So, in most cases, that should have strengthened the dollar, and in actual fact, it weakened based on the tariff news, so I suspect it’s possible that could all reverse next week.
Now, remember, Monday is a holiday in Canada, and it’s also a holiday in the US, so everything we do shifts over to Tuesday. So, looking at the key Vantage Point indicators, they are bearish on the dollar. I do have some fairly strong verified support lows at 106.69. We’ll see if that particular level can hold, but again, I think that once the market digests this all a little bit more, the dollar should rebound to some extent.
S&P 500 Index
Now, that’s been very positive for both equities and gold. We’ll look at equities first, but as we can see, the S&P stalled on the upper verified zone that’s at about 6121. So, if the Dollar Index can turn higher next week, then it’s certainly possible stocks could sell off at that particular point.
Now, we do see an MA diff cross trying to form here, and that’s something I’ll zoom in here so everybody can see it, but that pink line crossing the blue line is a contrarian signal. The market’s moving up, the VP indicator is starting to point down, the predicted RSI moving sideways, but the neural index is green, the index strength is not, it is actually sloping and pointing downward, suggesting that this move in equities is losing its momentum.
Now, that would make sense because, again, often what happens on Wednesday and Thursday in a holiday long weekend, there’ll be sometimes significant profit-taking, and I believe that that’s likely what happened to the dollar, but we’ll see how it plays out next week. But if that’s true, then equities would start to grind lower here back to our T cross long at 6050.
Gold
Now, with Gold contracts, we finished down on Friday a little bit, but a fairly significant move, the verified resistance high now comes in at 2940. There is additional very stiff resistance to 2980. Now, there are a lot of rumors circulating about gold, that somebody is taking delivery of very large contracts. I did receive an email on that particular issue, so we’ll see how this one plays out, but the VP indicators are losing momentum here.
Another good example of that neural index strength, not just the neural index but measuring the strength of it, it’s been pointing down actually since Thursday, and then Friday, we had a sharp move lower but still in a very strong bull market. Don’t get me wrong, but I believe that we could retest 2833 by month-end once we get back into that period of known US Dollar strength.
Light Sweet Crude Oil
Now, with Light Sweet Crude Oil, energy had a pretty nice rebound earlier in the week, but then came right back down. You can see that we tried to penetrate and close above the T cross long, we couldn’t do it, but again, we’re getting all tangled up on the current yearly opening price. Now again, as I’ve always, as I try to point out to everybody, and here we don’t want to shift the yearly, monthly, weekly opening price around to different dates or a random performance or rolling performance, random performance is what I call it, but we want something that we can measure. We can see that calendar yearly opening price is really where Oil, where the Bulls and the Bears are really fighting this out.
So, once again, we’re going to need a clean break of this level for oil to really make any substantial move to the downside. I believe the buyers are likely to step back in by about midday Tuesday to midday Wednesday of next week. So, watch your VP indicators, and again, using a 60/40 split with the predicted RSI, this split here is very very important because we’re using, or I’m using, the predicted RSI to gauge momentum, not overbought or oversold. I want to see if I have momentum. A break of the 40 level suggests that I have downward momentum, a break of the 60 level suggests I have upward momentum, but again, I’m not interested in overbought and oversold; I’m not, again, you’re basically telling the market to stop and turn and go the other way. That’s a very random way of trading something. So again, I’m looking for significant momentum below the calendar yearly opening price at $79.2 before I would get aggressively short on Oil contracts.
Bitcoin
Now, when we look at Bitcoin, once again, Bitcoin kind of moving sideways. We’ve had a couple of retests down near the yearly opening price; we bounced out of there, but the T cross long, that level for next week, $98,170. If we can breach that area and stay above it, it open the door to the 120-130 area. The VP indicators are coming online. Our MA diff cross is showing we’ve had a crossover back here, but the pink line over the zero line tells me we have a medium-term crossover; we don’t have a long-term yet, but we’ve got a rising predicted RSI. If I can break through 60 on that particular area, that would confirm the bullish momentum is still intact with Bitcoin, but either way, buying on a dip has been the better play for probably several years now.
DAX 30
Now, when we look at the DAX 30, I like to throw in the European Equity markets for my friends in Germany. So, once again, we can see the DAX remains quite bullish. Now, if that S&P can turn lower on Dollar strength, potentially by midweek next week, then that could pull the DAX down, but you’re fighting a pretty strong trend here, trying to short this thing, again, only in my respectful opinion, but we could have one forming.
The neural index strength is pointing down while the neural index is a solid green. That’s usually a warning sign that something else is coming here. So, when we look at that and our predicted differences and our predicted RSI, bringing everything in, the first level we would have to break is below the long predicted at 22,207. That would take us to 21,731, but the structural bias of this particular index, you can see the yearly opening, the monthly opening, the weekly opening, so a little trick for next week: watch how this responds to the weekly opening price; above it, you’re long, below it, you’re short, but let things shake out until about midday Tuesday with Monday being the holiday.
Volatility Index ($VIX)
Now again, we also want to look at the VIX, and remember what I talked about last week, the positive correlation between the VIX and the Dollar Index. So you can see the VIX under pressure, selling pressure, and so is the dollar. So if one or both of these turn around, then you may have something, but at 41.4, I don’t have a break of that predicted RSI momentum level, so if I break down below that 40 level, we could have momentum coming into the market. That’s what you want to keep an eye on. If that happens, then you’ll see your DAX, your S&P, maybe even your NASDAQ and your Dow start to move lower, but remember, they would be corrective moves lower on those, not a new trend until we turn negative on the calendar year.
Euro versus U.S. Dollar
Now, as we look at some of our main Forex pairs, starting with the most heavily traded Forex pair, Euro US, now again, very perplexing that with a hotter SE, a hotter PPI number, a hotter CPI that the dollar sold off, but again, I believe that’s the reaction to the tariff. So, we’re coming up into a very, very heavy resistance zone, 105.33. Keep a very close eye on this level, be cautious of a bull trap up here. That’s what I would recommend. We have another additional level coming in about 105.34, so these two verified zones here are very interesting, to say the least.
Now, if we can break through that, there isn’t a significant amount of resistance, but in order for that to happen, the Dollar Index would actually have to move below the 105, 104 area to push the Euro through this area. So again, it’s a mixed bag here. Our predicted differences are good; there’s our momentum play right there, with the predicted RSI breaking that 60 level; it pushed the Euro up, but I question whether that some of that is profit-taking with the long weekend, and then all of this reverses next week. So, be careful with this pair. The key thing here, guys, is to know your levels. We know where the monthly opening is, the yearly opening price; everything is gravitating around that area; that yearly opening price being 103.57, currently, that is now your support level. So, if there’s a retracement, we’re going to come back to our T cross long and our long predicted, and then we have the backup of the yearly opening price, but my optimism on a very strong Euro remains heavily guarded.
British Pound versus US Dollar
Now, looking at the Great Britain-US, it’s funny what things people will pick at. Last week, I had talked about this pair, and I said, well, it’s a substantial move, 3 to 400 pips down on GBP-US because I had discussed the breakout of going back up above the yearly opening price. But as you can see for this calendar year, how long it actually takes to move 414 pips, that’s your big move to the downside, and then when you look at the same on the upside, you’re about 426 pips. So again, yes, US-Japan, Great Britain-US over the years have moved 700 pips, but it’s not the norm, that’s the point that was being made. When you actually go back in VP plus, you can go back for years on this, several years, and you can see that this pair isn’t even moving 700 pips in a month, let alone a couple of days. That was the point that’s being made. So again, we need to know what our daily ranges are, and our weekly and monthly ranges, but it’s been actually years, several years, since this pair has moved 700 pips even in a month. So again, we want to make sure that’s the point of these presentations; they’re a weekly presentation, not a monthly, not a yearly. So again, I need to know what kind of movement I’m getting on this particular pair, so 300 pips, actually 350 pips to the downside, actually is a substantial move, respecting the monthly ranges that can easily be seen in the VP charts. So that would tell me that it could take a significant amount of time, seven maybe 10 days, maybe longer, but where it was sitting, we’ve had a series of higher lows, so the probability that it breaks the yearly opening price is higher. And again, last week, the Tuesday after the non-farm payroll number, the dollar falls victim to this same pattern. I believe that real money buys the dollar heavily at the end of the month into the first week of the new month, and then it flips, usually Tuesday, Wednesday the following week, the dollar tanks. Well, it did it again, guys, but that is unlikely to remain the course. So, for the pound, for next week, yes, it’s had a very substantial move up here, but again, the reverse check mark or the fact that the neural index is green but the neural index strength is actually pointing down, that’s where you’ve got to be careful here. That’s warning me that well, maybe this isn’t exactly what it seems. So, we have some verified resistance highs coming up around 125.75. It’s going to be interesting to see if the pound can continue higher, but you can see a number of verified zones sitting up here, right now. But again, always remember, like I said, yes, the Dollar-Yen, I’ve seen US-Canada also move 7-900 pips, but it’s not the norm, that’s the point. Again, we’re looking at where we are in the year, and I haven’t seen any really big massive moves, other than actually in US-Canada because of the tariffs, and even that was only about 200 pips. So again, we always wanted to make sure what we know, what the current volatility is, we’re not in Brexit anymore, things are fairly stable in the UK, so but the pound, I will concede, is the most volatile of the G7 pairs.
U.S. Dollar versus Swiss Franc
Now, with the US-Swiss Franc, a very violent reversal this past week. You can see that we came up into the monthly opening price, we again pointing out how important those are because we moved up to the monthly level and then failed, and then tripped back down, and now we’re slipping below the yearly opening price. So, if this pair remains below the yearly opening price, it will remain bearish, and that certainly is possible here, guys, it’s entirely possible. But if the dollar does turn back to the upside, then this would be also a very good buying opportunity, just make sure you’re keeping a very close eye on 9063. Now, point of interest here also is that the T cross long is sitting there, as is the long predicted, so you have a significant amount of resistance building around this particular area, around again, approximately 9063 to 9075. So, the savvy trader can play it two ways: we can sell into that area, and then have buy limits or buy stops ready to go back up above the yearly opening price, cut the one trade, go with the other one, but again, we can see that reverse checkmark on the neural index strength is saying, look, this is not as weak as maybe what we think it is. So again, watch the Dollar Index very closely if you’re trading this particular pair.
U.S. Dollar versus Japanese Yen
Now, with the Dollar-Yen, once again, the Dollar-Yen the structural bias of this, guys, the yearly opening price is highlighted in blue, the monthly coming in at a reddish color, $14.95, but the Dollar-Yen had a good week, but you can see where it’s failing into that T cross long, so that T cross long going into next week, that’s going to be 15382, 15287. Shorts carry a slight edge while below those particular levels, but again, we remain bearish on the year for now, and the longer we remain under 15728, the better shorts look going into the rest of the year. But again, what’s also one of the reasons why this also the Dollar-Yen had a decent week is again, that inflation data is coming in hotter, that should have strengthened the dollar rate across the board, but I believe there was some profit-taking involved there, like there always is after the non-farm payroll number, so this one could rebound, but longs are only viable if we can get above that T cross long and get above the monthly opening price, so at least we’re positive on the month before we start looking at executing long trades.
U.S. Dollar versus Canadian Dollar
Now, as confusing as this pair is, last week, there really is almost no reason to buy the Canadian dollar at this particular time. The political uncertainty, the tariffs, but the Canadian dollar has rebounded, but it’s rebounded on dollar weakness in a period of known dollar weakness. So again, I think that you’ve got a buy potentially forming. So, what I will look at is the VP software, and this pink line over the blue line is telling me exactly that, that whatever this is, it’s potentially coming to an end. So, I believe the Canadian dollar will come under further pressure until probably the spring, but again, the market will ultimately decide this price, the yearly opening price, the monthly opening price; structurally, this pair is bearish, but from a fundamental standpoint, I don’t see how. So, we have to look at both, but again, the market will decide things, but that’s why we have our VP software to warn us and say, oh, wait a minute, the market’s moving lower, but one of the core VP indicators is turning back up, then I look at the fundamental structure of Canada right now, and it says to me, I think there might be a long trade here. So, be careful with this one; it will be volatile, but for now, it remains bearish, but a corrective move higher back to our T cross long at 14320 appears to be imminent at this particular time.
Australian Dollar versus U.S. Dollar
Now, the Aussie and the Kiwi, now that’s again, equity-based currencies, but they’re much more reliable than the Canadian dollar right now; there are no tariffs on Australia or New Zealand, not yet anyway. So, when I look at the structural bias of this, I’m more drawn to these pairs than the US-Canadian pair, even though there may be a short there, I would much rather go long here. So, right now, we’ve remained relatively positive, I would say 90% of the year along the yearly opening price here. So again, our are we’re down there at 6189, longs remain in play, but be careful with this one. If those equity markets turn lower, if the equities turn lower, it’s going to pull the Aussie and the Kiwi right down with it, and the CAD. So for now, our T cross long for next week, 6271, but we do have some resistance, but it’s higher, it’s up towards this level up here, our first target there, 6471. Can we get that high? Possibly, but we need those equity markets; we need the S&P 500 pushing through that 6120 area. Again, the indicators here all look quite good for the Aussie to move higher.
New Zealand Dollar versus U.S. Dollar
The Kiwi, I believe the Kiwi may be a little undervalued to the Aussie, mainly because of the Australia-New Zealand pair. So for now, this looks like more of a fresh buy on the Kiwi. The structural bias with the yearly and the monthly
opening prices are fantastic. Our predicted differences look good; they’re not in overextended territory, the neural index, and the neural index strength are in complete agreement, and we have momentum on a break of the 60 of the predicted RSI. So that structural bias looks pretty good, but we’ve got to get above this high at 5723 and stay above that area so we can start targeting these upper levels.
So, once again, we are going to see likely a very volatile start to the week on Tuesday, not Monday, remember, holiday in Canada, holiday in the US, equals thin, illiquid markets on a Monday. So, but with that volatility, there will certainly be opportunity.
So, with that said, this is the Vantage Point AI Market Outlook for the week of February the 17th, 2025.
