Article originally published on innerfx.com and republished here with permission
The greatest challenge to any thinker is stating the problem in a way that will allow a solution. ~ Bertrand Russell
Good morning. Dollar pulled back yesterday as risk pairs rallied following stocks, hence my plans to look for selling opportunities on more AUD weakness are on-hold. Holidays are approaching, so it’s probably best to take a break – not focusing much on charts & trades these days.
Support formed by recent resistance around 80 is being breached, and that’s a big warning sign for dollar bulls. Perhaps is not the best thing to buy dips yet, but rather wait a bit more to see how this unfolds
Next resistance is around 1.32, so it’s a good idea to look for weakness signs if EUR gains 100 more points in the next sessions.
Short term charts are looking quite bearish now that the range has been breached to the downside, the opposite to what I expected – as I was looking for a buying opportunity on the potential break of 1.5650 resistance. One thing to consider in current conditions is to sell around 1.55 if price pulls back to the upside.
Pivotal support zone is under high pressure as CAD strengthens, following crude oil. Well, no more higher lows and one big leg down from recent top to 50% retracement are suggesting that it’s best to wait if you’re one of the US dollar bulls – otherwise consider selling on strength towards 1.0300 or more weakness, below 1.0200. I, for one, prefer to stand aside for now.
Either due to pre-holidays optimism or something else – it looks that recent top around 80 is on the radar: potential reversal candle there should provide a reason to sell.
Current hourly chart is as bullish as it gets, suggesting that it’s best to look for short-term scalps in case of minor pullbacks, hence buying dips