1.14 Is Out Of The Picture....For Now...
Dear Friends/Fellow Traders,
The US Dollar Bull Trend was stopped in its tracks by this morning's softer-than-expected economic leading indicator and the catastrophic Philadelphia Fed Manufacturing Index, at 0.1% and -0.7, respectively. Expected values were 0.3% and 8.0. The US Dollar plummeted against all the other currencies as long positions were covered for profits and short stops were ran. The USD/CAD fell from 1.14 all the way down to 1.1264 before finding minor support to stop the fall, aided by the rise in gold and oil prices. If the pair cannot close above 1.13 before the end of the week, we can expect a further decline in the pairing, possibly targetting 1.1140.
The stronger-than-expected numbers for the US in the past two weeks had everyone thinking that the US Economy was on a roll again, but after the soft numbers this morning I think the market is going to be thrown into confusion again, and we can all brace ourselves for a period of frustrating market consolidation as the bulls and bears battle each other for dominance.
For the traders who are going long USD/CAD, I would suggest that you cover your positions for losses now, rather than take bigger losses later, because 1.14 is out of the picture for now, unless you plan on holding the position long term, hoping that the USD will go on another bull run again.
However, my observation is that the commodities are poised for another run up again, and so will the commodity currencies CAD and AUD. The AUD/USD is nearing resistance at 0.7600 now and should that give way we will see further gains in the Aussie.
Conclusion? It will probably take a miracle to bring the USD/CAD back to 1.14 again in the next week or two, and if it does, we can all drop our jaws in disbelief.
Take care and stay tuned for more!
To successful trading,
Dickens
The US Dollar Bull Trend was stopped in its tracks by this morning's softer-than-expected economic leading indicator and the catastrophic Philadelphia Fed Manufacturing Index, at 0.1% and -0.7, respectively. Expected values were 0.3% and 8.0. The US Dollar plummeted against all the other currencies as long positions were covered for profits and short stops were ran. The USD/CAD fell from 1.14 all the way down to 1.1264 before finding minor support to stop the fall, aided by the rise in gold and oil prices. If the pair cannot close above 1.13 before the end of the week, we can expect a further decline in the pairing, possibly targetting 1.1140.
The stronger-than-expected numbers for the US in the past two weeks had everyone thinking that the US Economy was on a roll again, but after the soft numbers this morning I think the market is going to be thrown into confusion again, and we can all brace ourselves for a period of frustrating market consolidation as the bulls and bears battle each other for dominance.
For the traders who are going long USD/CAD, I would suggest that you cover your positions for losses now, rather than take bigger losses later, because 1.14 is out of the picture for now, unless you plan on holding the position long term, hoping that the USD will go on another bull run again.
However, my observation is that the commodities are poised for another run up again, and so will the commodity currencies CAD and AUD. The AUD/USD is nearing resistance at 0.7600 now and should that give way we will see further gains in the Aussie.
Conclusion? It will probably take a miracle to bring the USD/CAD back to 1.14 again in the next week or two, and if it does, we can all drop our jaws in disbelief.
Take care and stay tuned for more!
To successful trading,
Dickens
posted by ForexDragon at 7:42 PM
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