Charts I’m Watching: May 21, 2014

Abe confirms no increase in QQE for now, so a measly ¥70 trillion per annum still.  The USDJPY wasn’t thrilled at the news, and traded down through the SMA200 yet again — this time testing the Feb 4 lows.

Needless to say, the lack of increases in QQE doesn’t mean the BOJ won’t work to cheapen the yen anymore.  And, they’re keenly aware of the technical picture.  So, I’ll be very surprised if they don’t get the pair back to the SMA200 in short order.

2014-05-21-USDJPY 15 min 0537

After that, who knows?  The SMA10 intersects with the .382 Fib at around 101.66 — slightly higher than the old high.  It would allow ES to make a new high as well, maybe tag the .786 at 1890ish.

From here on, it’s all about threading the needle between too high a yen (hurts exports) and too low a yen (imports too expensive.)


Just broke through and tagged the yellow channel midline, should at least backtest here.  ES tagged the SMA20 in the process.  Could be a very whipsawy day, with Fed minutes and govspeak coming up.  But, the bottoming candle on USDJPY should be quite bullish for stocks — if it holds.

2014-05-21-USDJPY 15 min 0600

UPDATE:  3:10 PM

Everything responded negatively to the minutes except for stocks, which soldiered on, propped up by the PPT as proof that nothing the FOMC has planned could ever possibly hurt stocks.

TNX was propped up until its close, but clearly has closing this morning’s gap in mind.

2014-05-21-TNX 5-min 1207

USDJPY dropped like a rock…

2014-05-21-USDJPY 5-min 1207

The 10-yr spiked higher…

2014-05-21-ZN 60-min 1153

But, ES was unphased as the PPT was buying with both hands.

2014-05-21-ES 5 1156

Yet another tag for NDX on the neckline that just won’t die.

2014-05-21-NDX 60-min 1207


The rising ES channel (purple) contrasted with the falling USDJPY channel (red.)  We’ll watch to see if USDJPY can get back above the yellow channel midline after it digests its gains in the after-hours.

2014-05-21-ES v USDJPY

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