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Bend but don’t break. The dollar continues to hold its ground after running into a test near key technical levels in trading yesterday. Meanwhile, risk buyers saw the latest round of vaccine optimism fade rather quickly with US stocks slumping towards the close.
EUR/USD backed away after nearing 1.1900 again and has now moved back to test its key hourly moving averages with price leaning on the 200-hour moving average (now @ 1.1832) earlier today with gains limited by the 100-hour moving average @ 1.1852.
The drop in GBP/USD from 1.3300 sees it run towards a test of its 100-hour moving average @ 1.3225 but buyers are still keeping near-term control for the time being.
USD/CAD sellers tried for a break below its 200-hour moving average and 12 November low @ 1.3058 but the push ended briefly as price action reversed higher back to the range in between its key hourly moving averages of 1.3074-98 currently.
Meanwhile, AUD/USD is once again keeping around its key hourly moving averages @ 0.7285-96 as buyers and sellers duke it out for near-term control as resistance from last week’s high at 0.7340 remains intact in trading this week.
In the commodities space, gold is gradually softening as sellers keep near-term control on a push towards the key support region around $1,855-63 with the late September lows around $1,848 an area to watch in case of a break to the downside.
Another flush in gold would arguably be a great buying opportunity in the long-run, especially if we get one closer to the 200-day moving average just under $1,800 again.
To sum up the above, it looks like the dollar was pushed near the brink but held on and traders are now caught in a near-term battle to decide the next direction again.
The S&P 500 also fell below 3,600 and the 2 September high of 3,588 so that is now keeping sellers in the game as buyers lose grip of the upside momentum.
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