FX Breakout Monitor: Silver beats gold to the punch
Head of FX Strategy
Summary: Silver is grabbing our attention with a massive extension higher after a break to a new high yesterday. Gold looking to post a new short term high today as well. The recent USD breakdown not following through in some of the major USD pairs, though some EM currencies looking at fresh highs versus the greenback today.
The FX Breakout Monitor is back, and it is expanded with "autosignals" that show examples of how to trade new breakouts, defined as new 19-day high or low closes not preceded by a breakout in the same direction in the prior week. Click on the link below for a look at the full PDF of the table overview and the Recent New Breakouts tables. See further below for a couple of chart highlights related to today's monitor.
Today’s Breakout monitor
The recent USD breaks lower versus everything from the EUR and GBP to SEK and NZD has faced a few days of consolidation, muddling the outlook there, but EM currencies remain on the bid with the ruble attempting a new break higher today versus the US dollar despite a larger than expected Russian Central Bank rate cut today that erodes carry for RUB longs.
But it is really in the precious metals department that we are seeing impressive moves with silver (more below) beating gold to the punch in breaking higher versus the USD yesterday, though gold looks to post a new 19-day high today if it holds above 1506 on the close.
Elsewhere, AUDNZD traders were in for whiplash as Wednesday’s new low daily close was quickly rejected today (note that the break failed to clear the range on that one), while EURCHF traders are eyeing the 1.1050 area probably more than the nominal high close for the cycle at 1.1025 for upside break prospects from here. And NOK is so weak that it is actually on the verge of breaking lower versus the mixed US dollar.
Today’s Breakout Highlight: XAGUSD
Often, when silver goes, it goes all at once, as yesterday’s break above the recent range and to a new 19-day high has unleashed a tremendous follow through in today’s trading. The high daily close for the cycle is the next major objective up near 19.60.
Quarterly Outlook Q2 2022
Quarterly Outlook Q2 2022: The End Game has arrived
- Shocks from covid and the war in Ukraine have forced the global financial and political world to change, but what will the end game be?
Productivity and innovation have never been more importantAs the world economy hits physical limits and central banks tighten their belts, could equities be facing a 10-15% downside?
The great EUR recovery and the difficulty of trading itIf the terrible fog of war hopefully lifts soon, the conditions are promising for the euro to reprice significantly higher.
Tight commodity markets – turbocharged by war and sanctionsWith supply already tight, commodities keep powering on. But will it last for yet another quarter?
Between a rock and a hard placeGeopolitical concerns will add upward price pressures and fears of slower growth, while volatility will remain elevated.
The Great ErosionInflation is everywhere and central banks try to combat it. But will they get it under control in time?
Australian investing: Six considerations amid triple Rs: rising rates, record inflation and likely recessionWhile global financial markets are struggling in an uncertain world, the commodity-heavy Australian ASX index is poised to keep a positive momentum.
Cybersecurity – the rush to catch up with realityWith the invasion of Ukraine, governments and private companies are rushing to reinforce their cyber defenses.