Chart Advisor: USD, NVDA, AAPL

By Dean Rogers, CMT

1/ U.S. Dollar Index (DXY)

2/ NVDA Daily Chart

3/ AAPL Daily Chart

4/ MU Daily Chart

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1/

U.S. Dollar Index (DXY)

The U.S. Dollar Index has steadily risen since forming a low at 70.70 in March of 2008. The move up from 70.70 may be forming a five-wave trend that targets 125.00. Albeit this is not a textbook example, the current outlook is bearish, and it will likely take several more years to reach 125.0 should the uptrend persist. 

The current wave count implies that the pullback from the September 2022 swing high of 114.78 is forming the corrective wave 4/V that should reach at least the 99.79 equal to (1.00) Fibonacci extension of the wave down from 107.35 (dark cyan). 

Courtesy of TradeStation

Settling below 99.79 would call for a major support threshold around 98.00 to be challenged. This is a key level because it is the smaller than (0.618) target of the wave down from 114.78 (green), the 38 percent retracement of the rise from 70.70 (blue), and the 62 percent retracement of the rise from $88.25 (light blue). Settling below 98.00 will likely be a challenge given the confluence and importance of this support level. However, a monthly close below 98.00 would reflect bearish sentiment for the dollar for at least another several months. This is because the wave down from 114.78 (green) would favor an eventual test of its 92.15 equal to (1.00) target. 

Based on the analysis above, the outlook for the dollar is bearish for at least another couple of months as the index falls to 99.79 and likely 98.0. However, should 99.79 hold and the dollar rise above the 38 percent retracement of the decline from 107.35 (orchid) look for a test of an important resistance level at 104.80. This is split between the 62 percent retracement from 107.35 (orchid) and the smaller than (0.618) target of the wave up from 99.58 (orange). Settling above 104.8 would call for a bullish decision point around 108.50 to be challenged. This level is split between the equal to (1.00) target of the wave up from 99.58 (orange) and below the 62 percent retracement of the decline from 114.78 (pink). A sustained close above 108.50 would strongly suggest that the corrective wave 4/V down from 114.78 is complete and that wave iii//5/V is underway. 

2/

NVDA Daily Chart

Nvidia (NVDA) is on the rise but met and held resistance at $126.28 on a closing basis today. This objective is split between the smaller than (0.618) target of the waves up from $90.69 (red) and $100.95 (dark red). A test of support might take place before settling above $126.28 but the 38 percent retracement of the rise from $100.95 at $114.76 is expected to hold. This is because the Kase Easy Entry System (KEES) is long (blue L) and there are no KaseCD or KasePO bearish divergences or overbought signals. Furthermore, waves that meet the smaller than (0.618) target typically extend to at least their equal to (1.00) target. In this case, that is $133.06 for the wave up from $100.95 (dark red) and $141.17 for the wave up from $90.69 (red). Settling above $141.17 will open the way for $157.02 and $167.45. 

Courtesy of TradeStation

Should Nvidia close below $117.46 look for an extended correction to challenge key support at $110.0. This is split between the 62 percent retracement of the rise from $100.95 (light blue) and the smaller than (0.618) target of the wave down from $131.26 (light green) and is in line with Kase Dev3. This is a trailing stop based upon a 3.6 standard deviation move of the 30-day Average True Range. Settling below $110.0 would reflect bearish sentiment and put the odds in favor of Nvidia falling to challenge the $100.32 smaller than (0.618) target of the wave down from $140.76, which then connects to $81.19 as the equal to (1.00) target. 

3/

AAPL Daily Chart

Apple (AAPL) is poised to rise in the coming weeks but is struggling to overcome the 89 percent retracement of the decline from $237.23 at $232.69. This level has been tested twice and held on a closing basis in recent weeks. A bearish KaseCD divergence and a weak bearish KasePO divergence warn that a deeper test of support might take place first. However, the pullback from $233.09 has held the 21 percent retracement of the rise from $196.00 (blue) and is likely a correction. Today’s 2nd class long KEES signal (cyan L) also suggests that the move up will rechallenge $232.69 in the coming days. Closing above this will call for $236.35, which then connects to $243.19 and $250.66. 

Courtesy of TradeStation

That said, should the corrective move down extend look for support at $218.92. A simple correction will hold this level because it is the 38 percent retracement of the rise from $196.00. Settling below $218.92 would warn that the move up is failing and call for key support at $209.00 to be challenged. This is the 62 percent retracement and smaller than (0.618) target of the wave down from $237.23. Settling below $209.0 would put the odds in favor of Apple falling to $191.86 and possibly lower. 

4/

MU Daily Chart

Micron Technology (MU) soared today and formed a breakaway gap. The validity of the gap was confirmed by a sizable increase in volume and was preceded by a bullish KasePO momentum divergence (green line) at the $84.12 swing low and a 2nd class KEES buy signal (cyan L). 

Courtesy of TradeStation

Micron challenged resistance at $112.17, which is the 38 percent retracement of the decline from $157.54 (pink). This level held on a closing basis, so the next few days will be crucial. Settling above $112.17 will call for a push to challenge the key 62 percent retracement at $129.49. A sustained close above this would imply that the move down from $157.54 is complete. 

However, settling below $103.08, the 38 percent retracement of the rise from $84.12 (blue) before rising any higher would suggest that the gap will be filled. In this case, $95.84, the 62 percent retracement, which is also in line with the bottom of the gap, must hold. Closing below $95.84 will indicate that the move up has failed and that Micron will retain a bearish outlook for now. 

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Originally posted 27th September 2024

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