- It’s been a positive session here on Monday again, as we’ve seen the British Pound rally a bit against the US dollar.
- But truthfully, I don’t know if I would get overly excited at this point because, this is a market that clearly has a lot of resistance above the 1.3550 level, extending to the 1.36 level.
- All things being equal, this is a market that I think continues to see a lot of concerns at the 1.36 level.
And if we were to break above there, it could put a little bit of a short squeeze. But right now, I think a lot of what’s going on is traders are trying to determine if the Federal Reserve is cutting rates, whether or not they’re going to be aggressive. And if they are aggressive, what does that say about the global economy?
Dollars are for Safety Often.
In a twist of an irony, a lot of times what happens is when the global economy sees that the United States is stumbling a bit, it’s the global economy that suffers over the longer term. So initially you see the US dollar sell off, and then you see it strengthen because everybody is running to safety. It’ll be interesting to see how this plays out.
As things stand right now, despite the fact that it’s been a bullish couple of days, we really haven’t changed the overall trajectory of this very sideways market. I think at this point in time, we need to break out of this 200 pip range to even have a significant conversation of a bigger trade. Short-term traders will probably continue to play the range, and it looks like we’re getting close to the top. So read into that what you will going forward in this market.
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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.
