It's an interesting spot for markets, monthly close in 4 days, risk assets under resistance, DXY at support.
-DXY/US DOLLAR
After breaking out of the multi year consolidation DXY has pulled back and has been testing the top of that consolidation for 6 months now. The fact that it has failed to continue to target so far is noteworthy and could be a hint that it may fail and fall back below 100. The alternate view is that retesting for 6 months after a multi year consolidation is no big deal and despite huge rallies in equities the DXY has been able to hold above 101.
Could this continue to consolidate here for another 6 months, possible also but it's noteworthy with stocks reaching major HTF resistance areas and DXY bouncing and looking like it might be forming a higher low on the lower time frames.
-NQ1!
The NASDAQ has come into weekly resistance, sweeping some relative equal highs in the process, it is above a monthly order block I had marked but price showed only a little reaction to it on the way up, it will be worth watching how price interacts with it as a level of support now. It's kinda crazy that NASDAQ is less than 2000 points away from ATH and I wouldn't be surprised to see new ATHs. It's been consolidating below resistance for a week now.
-BTC
Bitcoin finished this week as a bullish engulfing candle of the previous 9 weeks candles creating a new yearly high, it did stop at weekly resistance and is consolidating below currently.
How high can this go? As per last weeks target I'm still looking at the highs at 32399 as first candidate, second would be a push up into the monthly candle body low of July 21 that lines up roughly with the top of the weekly OB and the 0.382 fib of the entire '22 bear market.
Noteworthy; after the March bullish marubozu candle price consolidated sideways for three weeks before finally pushing only a further 9.1% higher before correcting for 9 weeks. 10% from this weeks candle high puts us close to 35k.
So are we entering a new bull market? I've seen a lot of frothy bulls calling for 100k + targets already and whilst I agree long term, I don't think it will happen by next month. The markets definitely at an interesting spot, DXY loosing support and stocks/crypto breaking these resistance levels with stocks putting in new ATH's things could pump pretty quickly. I don't have a bias either way here, nor do I know what narratives or catalysts could push price either way. There's the whole Blackrock ETF that has given us this big move in crypto but what forces stocks into new all time highs and dollar to collapse below 100? I'm no macro expert so I'll be relying on my PA analysis to guide me.
If there are any observations I have from a ground level experience, just in the last week my partner had her employment hours cut in half and my brother told me he was going to have to let go all of his casual staff and go back to working 6 days just to keep his business afloat. That's on top of rising living costs and interest rates continuing to rise here in Australia putting a lot of pressure on many people I know who have taken out home loans in the last 5 years. So a bull market rally here would only lead to higher inflation in my understanding of things, higher interest rates, which would lead to small business's failing, rising unemployment, people defaulting on home loans and ultimately a deep recession. I may not understand the mechanics fully but I can't see institutions like the US fed encouraging that Or would they? Keen to hear the thoughts of others who might understand this better than myself.
TRADE PLANS FOR THE COMING WEEK
Pretty simple, looking to buy dips, pretty convinced BTC trades to 32399 minimum from here, I can't see that liquidity going untapped. Being patient and seeing how low this goes, there's a low at 29525 that I would bid a sweep of, there's also the consolidation around 28850, wait and see. Will post if I enter a trade.
Not financial advice just my observations.