The market is reacting to a surge in rate and as expected the dollar is starting to get traction.
I hope the chart is self explanatory but I will try to put it in writing:
- We have reached deep oversold compared to previous level but we have made a higher low.
- As predicted, is crossing.
- If we confirm the head and shoulder we should break the long term resistance. In that case, what ever pull back is an opportunity to buy.
- Then we will have another level of resistance and another pull back confirming the .
Get some profits (50%) @ 112.30
Reload x3 @ 109.5
Buy anytime @ 113.5 and hold till 118.30
Should will leave us some time to see how picks up in Japan and how things unfold in the US.
I strongly believe that the Treasuries are just going to shoot up to 3.5% before we know it, and that after the breach of the long term resistance we will see a strong jump!
Stop @ 108.25
We really need this level to hold.
Stops at 107.25 advised
The trade looks very much compromised - looking to exist at 102, putting stop at 106
Reaction to January CPI (inflation is indeed back) is going opposite to the expected reaction, all in all big cloud on the direction on the USD going foreward.