- The Aussie dollar initially pulled back just a bit during the trading session here on Monday, which is not a huge surprise considering there are a lot of concerns out there when it comes to global chaos, conflict, et cetera.
- That of course does have people worried about risk appetite, but we turned around and really took off after that.
- Now it looks like we are actually threatening some type of breakout. If we can get that breakout, then we could see this market really move to the upside, perhaps to the 0.66 level at the top of the channel, or maybe even 0.67.
I have no interest in shorting the market. I think it’s far too strong at this point, but a pullback certainly is something that we need to watch carefully. The uptrend line comes into the picture. We just had the 50 day EMA break above the 200 day EMA kicking off the so-called golden cross, which is something that a lot of people will watch as well.
Positive, Eventually
Ultimately, I like this market, but only if we get confirmation. Right now, we are definitely knocking on the door, but we don’t have the follow through quite yet. This is an area that’s been a lot of trouble in the past. So, I do think that you could find yourself in a little bit of trouble if you get aggressive in this market right now.
With that, I feel good about the upside, but I also recognize that you’re going to need some type of catalyst. Maybe it’s a calming of tensions in the Middle East. We just don’t know what it’s going to be, but something will make people happy to push this higher. If we break down below the moving averages, that changes everything. But right now, we’re just in this up trending channel.
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Christopher Lewis has been trading Forex and has over 20 years experience in financial markets. Chris has been a regular contributor to Daily Forex since the early days of the site. He writes about Forex for several online publications, including FX Empire, Investing.com, and his own site, aptly named The Trader Guy. Chris favours technical analysis methods to identify his trades and likes to trade equity indices and commodities as well as Forex. He favours a longer-term trading style, and his trades often last for days or weeks.